The independent public accountant performing this special function owes ultimate allegiance to the corporation's creditors and stockholders, as well as to the investing public. This 'public watchdog' function demands that the accountant maintain total independence from the client at all times and requires complete fidelity and public trust. Problems with Auditor Independence Even though the accountant's responsibility to the public, there are several studies that question whether accountants uphold this responsibility. The challenges can be divided into two principal categories. However, even it is obvious that auditing firms' aspirations to maximize the number of well-paying clients provides them considerable interest in their clients' financial successes.
Firms have a strong stake in both patron retention and financial solvency.
One can claim that the accountants' dependency on compensation from and gratitude to the client limits independence. Thus, it is possible to contend the degree public expectations of independence are unjustified. In addition to the large fees received for auditing, other financial relationships place a strain on the auditor's ability to be independent. Opponents have argued that the allowance of such relationships unnecessarily increases the already extensive financial dependency of the auditor on the client. On the other hand, proponents claim that the synergy between the two functions assists the accounting firm to produce improved services in both areas.