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From the WorldCom and Enron accounting debacles that triggered the demise of Arthur Andersen to Ernst & Young's 2013 and 2015 settlements claiming that its audits facilitated massive accounting fraud by financial services firm Lehman Brothers, large-scale financial scandals have led to increasing scrutiny of public auditors. Investors are justifiably eager to ascertain the quality of audits of public companies when making investment decisions. In the U.K., the reputation of the audit partner is recognized as a signal of audit quality, and as such, the names of the lead partner have been disclosed to the public since 2009. The U.S. standard of providing the auditing firm name without identifying the lead partner recently changed to match the U.K. and EU standard after much debate. As of May 2016, the Public Company Accounting Oversight Board has adopted-and the Securities and Exchange Commission has approved-new regulations that will require the public disclosure of the individual audit partner responsible for each public company audit, as well as the identification of any additional accounting firms that contribute to the audit. This article examines the new rules in light of disclosure requirements imposed on other professionals, as well as international auditor disclosure requirements. The accounting profession has generally opposed the new disclosures, but this article suggests opportunities and benefits for the profession as a result of the changes, including the opportunity for audit partners to develop individual reputations for quality and specialization. In addition, this article makes recommendations for business managers, owners, and investors for making the best use of the information the new disclosures will provide.

Employers are using pre-employment personality tests with increased frequency to identify the candidates best equipped to perform certain jobs and to eliminate the candidates least likely to succeed. While these tests promise higher retention rates and increased objectivity in hiring, they can also expose employers to litigation for violation of federal anti-discrimination statutes. This installment of Accounting Matters explores several recent lawsuits and the laws governing the discrimination claims, and concludes by offering several best practices for reducing the risk of litigation when using pre-employment personality tests.