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Global audit market is facing several trends and reforms. The aim of these reform is to development the competition in the market of an audit and improve quality of the audit by mandatory auditor rotation and making the financial reports more informative. We make our review around two factors that have big effect on to audit quality, namely auditor tenure and audit firm rotation. Audit quality has long drawn the attention of researchers, investors, auditors, and regulators. To help interested parties better understand the audit quality. We review some studies published about audit tenure, audit firm rotation and audit quality. The purpose of the paper is to review some factors that affect audit quality, namely, auditor rotation and auditor tenure. Whereas the proponents of rotation argue that the long time between the auditor and his client compromises the independence and objectivity, which will affect audit quality as a negatively manner. But the opponents of mandatory rotation argue that switching audit firm will lead to special knowledge in client’s work which reduces audit quality and its will lead to additional costs for switching audit firms. Based on the literature review, we found that there are a few evidence that audit quality is decreased in the presence of audit firm rotation. With regard to auditor tenure, there are two opposing views on the effects of auditor tenure on audit quality. The long relationship between the auditor and his client reduces the auditor’s independence, and affecting audit quality in a negatively manner. On the other hand of the debate, switching of the auditors will lead to loss the specific knowledge in the client work which reduces audit quality and incurs additional costs for switching auditors. We conclude that long auditor tenure impair audit quality and independence.

Auditor Tenure, Audit Firm Rotation and Audit Quality: A Literature Review