IDEAS home Printed from
   My bibliography  Save this article

Auditors as Regulatory Actors: The Role of Auditors in Banking Regulation in Switzerland


  • Ian P. Dewing
  • Peter O. Russell


This paper investigates the long-standing Swiss dualistic approach to banking supervision, whereby banks' external auditors report not only to shareholders under company legislation but also report to, and undertake work for, the banking regulator under banking legislation. The dual role raises the issue of whether auditors are sufficiently independent of management to act fairly with respect to both shareholders and supervisors. In contrast, recent literature and policy-making on regulation advocates the need to close the distance between regulators and those regulated, and the Basel Committee on Banking Supervision has advocated a closer relationship between banking supervisors and banks' external auditors. The paper investigates the dual role by providing empirical evidence from interviews undertaken with Swiss audit partners, and analysis of documentary material from the Swiss banking regulator and IMF. The paper concludes inter alia that the Swiss dualistic system ‘works’ because it is supported by a layered regulatory approach at audit firm, national and international levels to ensure and safeguard auditor independence and competence. Whether such a system would work elsewhere depends on national factors such as conceptions of the nature of corporate governance and of the state, and prevailing views on private actors undertaking public roles.

Suggested Citation

  • Ian P. Dewing & Peter O. Russell, 2012. "Auditors as Regulatory Actors: The Role of Auditors in Banking Regulation in Switzerland," European Accounting Review, Taylor & Francis Journals, vol. 21(1), pages 1-28, January.
  • Handle: RePEc:taf:euract:v:21:y:2012:i:1:p:1-28 DOI: 10.1080/09638180.2010.522776

    Download full text from publisher

    File URL:
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    1. repec:bla:joares:v:34:y:1996:i::p:1-20 is not listed on IDEAS
    2. Mary Barth, 2006. "Including estimates of the future in today's financial statements," BIS Working Papers 208, Bank for International Settlements.
    3. Guillaume Plantin & Haresh Sapra & Hyun Song Shin, 2008. "Marking-to-Market: Panacea or Pandora's Box?," Journal of Accounting Research, Wiley Blackwell, vol. 46(2), pages 435-460, May.
    4. Carmen M. Reinhart & Kenneth S. Rogoff, 2009. "Varieties of Crises and Their Dates," Introductory Chapters,in: This Time Is Different: Eight Centuries of Financial Folly Princeton University Press.
    5. Barth, Mary E. & Beaver, William H. & Landsman, Wayne R., 2001. "The relevance of the value relevance literature for financial accounting standard setting: another view," Journal of Accounting and Economics, Elsevier, vol. 31(1-3), pages 77-104, September.
    6. Christian Laux & Christian Leuz, 2010. "Did Fair-Value Accounting Contribute to the Financial Crisis?," Journal of Economic Perspectives, American Economic Association, vol. 24(1), pages 93-118, Winter.
    7. Plantin, G. & Sapra, H. & Shin, H S., 2008. "Fair value accounting and financial stability," Financial Stability Review, Banque de France, issue 12, pages 85-94, October.
    8. Beatty, Anne & Chamberlain, Sandra & Magliolo, Joseph, 1996. "An empirical analysis of the economic implications of fair value accounting for investment securities," Journal of Accounting and Economics, Elsevier, vol. 22(1-3), pages 43-77, October.
    9. Barth, Mary E. & Landsman, Wayne R. & Wahlen, James M., 1995. "Fair value accounting: Effects on banks' earnings volatility, regulatory capital, and value of contractual cash flows," Journal of Banking & Finance, Elsevier, vol. 19(3-4), pages 577-605, June.
    10. Eccher, Elizabeth A. & Ramesh, K. & Thiagarajan, S. Ramu, 1996. "Fair value disclosures by bank holding companies," Journal of Accounting and Economics, Elsevier, vol. 22(1-3), pages 79-117, October.
    11. Reinhart, Karmen & Rogoff, Kenneth, 2009. ""This time is different": panorama of eight centuries of financial crises," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 77-114, March.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:euract:v:21:y:2012:i:1:p:1-28. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.