Author:Ghani, Ali Naeem Jasim Al


  1. Auditor independence requires practitioners to avoid any engagement that suggests they have shared interests in the activities of their clients.

  2. TQM is an eight-element approach to quality improvement that attempts to integrate all elements of quality into a single framework.

  3. Ethics, integrity, and honesty are the foundation blocks of TQM.

  4. Auditor independence can help improve ethics, integrity, and honesty.


    The research background, problem, objectives, and hypothesis are presented in this section. The chapter also summarizes the significance of the study and its contribution to the literature. Although the relationship between auditing and quality management has been established, few studies, if any, have explored the possible association between auditor independence and total quality management.


    Customer satisfaction and loyalty are among the central factors in the success of an organization. Satisfied clients create platforms through which firms can enhance the image of their brands, increase their profitability, and remain competitively relevant (Allen et al., 2007). Today's consumer has wide information base and a broad range of options. Therefore, many organizations struggle to keep their clients for extended periods. The situation has prompted companies to experiment with different strategies that can help them in tracking and monitor the changes in customers' contentment and commitment to their products.

    One framework that has proved successful in this regard is the Total Quality Management (TQM). TQM is an approach to process management that endeavors to put quality at the center of an organization's leadership, planning, improvement initiatives, and other activities. The emphasis on "total" highlights the need for a complete collaboration of all the internal units of an organization, including production, human resource, accounting and finance, marketing, and other departments (Mohebbi et al., 2003). The use of TQM permits managers to create organizational environments in which each employee is sensitive to the need to make continuous improvements on their skills and abilities to ensure that a company's goods and services meet the demands of its customers. In addition to enhancing consumer satisfaction, TQM also improves the production process of a business as well as the efficiency of the human resource force (Nasution et al., 2017).

    As a philosophy, TQM bases its ideas on integrity, trust, as well as ethics and requires organizations to engage in practices that foster sincerity, fairness, and openness in the business environment (Mohebbi et al., 2003). A company's auditing practices are central to the realization of these objectives. TQM auditors, especially external ones, play critical roles in ensuring that the firms that they represent are honest in their activities. As representatives of shareholders' interests, auditors endeavor to promote honesty, openness, and accountability, which are essential elements of corporate governance. There are many debates surrounding the qualification for an entity to be considered a customer in the TQM model (Lemay et al., 2009). Despite such disagreements, the TQM framework continues to be popular among researchers.

    Realizing these goals is not always an easy task. Several situations in the business environment, most of which involve a conflict of interests, may prompt auditors to compromise their standards. Accordingly, accounting bodies have developed several measures that can help practitioners maintain their integrity. One such principle is auditor independence. The independence of auditors as a philosophy permits practitioners to uphold high levels of integrity, trust, and moral conducts. The present paper examines the role of auditor independence in promoting TQM concepts.

    Statement of the Problem

    For many years, the use of TQM was limited to the manufacturing sector. However, in recent decades, the scope of the application of these principles has extended beyond manufacturing. Many non-manufacturing firms are adopting TQM principles to enhance the quality of their processes. For this latter category, the emphasis has been on using TQM principles to promote not only processes, but also good governance (Kaynak & Roger, 2013). Despite this growing emphasis, few companies have been successful in their attempts to implement TQM strategies. Challenges that have been cited include low management and staff commitment, the absence of standard frameworks for defining quality, incompatibility with organizational culture, and problems with accuracy in planning (Kwama et al., 2014). There is a growing need for efficient approaches that can help companies to promote TQM practices. The current investigation assessed whether adhering to the requirements of auditor independence can be useful in this regard.

    Significance and Scope

    The relationship between auditing, both internal and external, and TQM has been established in the literature. Even though past studies on the subject have revealed mixed findings, many of them concur that the use of TQM enhances the quality of a firm's auditing practices (Ahmad et al., 2012; Olcay & Sadikoglu, 2014). However, there has been little emphasis on the possible link between auditor independence and quality management practices of an organization. The present investigation attempts to address this gap, and its findings can be useful in establishing strategies for quality improvement through enhanced auditing practices. TQM is usually considered to comprise eight elements (Table 1 and Figure 1). The study focuses on three of these components, integrity, ethics, and trust. The choice of these factors is based on the assumption that the can be greatly affected by compromised auditor independence more than the other five factors.

    Aim, Objectives, and Hypothesis

    The present paper aims at assessing the possible impacts of auditor independence on TQM. The specific objectives are as follows:

  5. To objectively assess the current state of auditor independence.

  6. To analyze the relationship between total between auditor independence and TQM.

    The independent auditor ensures quality by providing a third-party enforcement of integrity in a firm's financial reporting practices (Ahmad et al., 2012). Adherence to established auditing standards can be helpful in improving the quality of processes in an organization. This observation formed the basis for the research hypothesis, which is state as follows:

    [H.sub.1]: There is a positive relationship between the independence of the auditor independence and TQM.

    Paper Structure

    The paper has three sections. Following the introduction is literature review that presents the key concepts, supporting framework, and past studies on the relationship between auditor independence and TQM. The third section is the practical part, which includes the research methods used are summarized as well as description of the study sample. The main findings and their discussions, conclusions, implications, and recommendations for future practice are also included in the practical part.


    The previous chapter has summarized the research problem, the relevant background, and the aim of the paper. The present section a brief overview of the key concepts used in the research, TQM and auditor independence. The relationship between the two variables as presented in previous studies is also highlighted. The section concludes with a discussion of the theoretical framework that has guided the investigation.

    Total Quality Management

    Organizations across the world and different economic sectors are implementing significant changes in their operations to improve the quality of their processes. Most approaches to quality enhancement emphasize particular dimensions of quality such as standards and measurements, efficient supervision and management, regular feedback, and staff training. TQM is an approach to process improvement that integrates several dimensions of quality. The method is viewed as a continual process that involves the constant evaluation of an organization's practices to identify and eliminate errors while improving customer experience. The complete involvement of all the relevant...

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