IDEAS home Printed from https://ideas.repec.org/a/taf/euract/v21y2012i1p1-28.html
   My bibliography  Save this article

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

Author

Listed:
  • Ian P. Dewing
  • Peter O. Russell

Abstract

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
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09638180.2010.522776
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/09638180.2010.522776?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

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

    References listed on IDEAS

    as
    1. International Monetary Fund, 2002. "Republic of Croatia: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Banking Supervision, Payments Systems, Securities Regula," IMF Staff Country Reports 2002/180, International Monetary Fund.
    2. International Monetary Fund, 2002. "Bulgaria: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Supervision, Se," IMF Staff Country Reports 2002/188, International Monetary Fund.
    3. International Monetary Fund, 2002. "Luxembourg: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Supervision, ," IMF Staff Country Reports 2002/116, International Monetary Fund.
    4. Hutter, Bridget M., 2006. "The role of non-state actors in regulation," LSE Research Online Documents on Economics 36118, London School of Economics and Political Science, LSE Library.
    5. International Monetary Fund, 2002. "Sweden: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Supervision, Secu," IMF Staff Country Reports 2002/161, International Monetary Fund.
    6. Baldwin, Robert & Cave, Martin & Lodge, Martin, 2011. "Understanding Regulation: Theory, Strategy, and Practice," OUP Catalogue, Oxford University Press, edition 2, number 9780199576098.
    7. International Monetary Fund, 2002. "Tunisia: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Supervision, Sec," IMF Staff Country Reports 2002/119, International Monetary Fund.
    8. International Monetary Fund, 2002. "Philippines: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Supervision,," IMF Staff Country Reports 2002/222, International Monetary Fund.
    9. International Monetary Fund, 2002. "Switzerland: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Banking Supervision, Securities Regulation, Insurance Regulation," IMF Staff Country Reports 2002/108, International Monetary Fund.
    10. International Monetary Fund, 2002. "Republic of Lithuania: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Su," IMF Staff Country Reports 2002/019, International Monetary Fund.
    11. Black, Julia, 2003. "Mapping the contours of contemporary financial services regulation," LSE Research Online Documents on Economics 36045, London School of Economics and Political Science, LSE Library.
    12. Parker,Christine, 2002. "The Open Corporation," Cambridge Books, Cambridge University Press, number 9780521818902, October.
    13. John Cooper, 1984. "The Management and Regulation of Banks," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-06527-1, June.
    14. International Monetary Fund, 2002. "Hungary: Financial System Stability Assessment Follow-up, including Reports on the Observance of Standards and Codes on the following topics: Monetary and Financial Policy Transparency, Banking Superv," IMF Staff Country Reports 2002/112, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Elfers, Ferdinand & Koenraadt, Jeroen, 2022. "What you don’t know won’t hurt you: Market monitoring and bank supervisors’ preference for private information," Journal of Banking & Finance, Elsevier, vol. 143(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. International Monetary Fund, 2004. "Hungary: Selected Issues," IMF Staff Country Reports 2004/146, International Monetary Fund.
    2. Ian Dewing & Peter Russell, 2009. "Implementing new financial regulation: actuaries and UK with-profits funds," The Service Industries Journal, Taylor & Francis Journals, vol. 30(12), pages 1955-1966, June.
    3. Ayadi, Rym & Arbak, Emrah & De Groen, Willem Pieter, 2013. "Convergence and Integration of Banking Sector Regulations in the Euro-Mediterranean area," CEPS Papers 7853, Centre for European Policy Studies.
    4. Bärbel R. Dorbeck‐Jung & Mirjan J. Oude Vrielink & Jordy F. Gosselt & Joris J. Van Hoof & Menno D. T. De Jong, 2010. "Contested hybridization of regulation: Failure of the Dutch regulatory system to protect minors from harmful media," Regulation & Governance, John Wiley & Sons, vol. 4(2), pages 154-174, June.
    5. Geoff Walters & Sean Hamil, 2013. "The contests for power and influence over the regulatory space within the English professional football industry, 1980-2012," Business History, Taylor & Francis Journals, vol. 55(5), pages 740-767, July.
    6. Mia Rahim & Shawkat Alam, 2014. "Convergence of Corporate Social Responsibility and Corporate Governance in Weak Economies: The case of Bangladesh," Journal of Business Ethics, Springer, vol. 121(4), pages 607-620, June.
    7. Ojo, Marianne, 2009. "Responsive regulation:achieving the right balance between persuasion and penalisation," MPRA Paper 15543, University Library of Munich, Germany, revised Jun 2009.
    8. David Levi-Faur, 2005. "The Global Diffusion of Regulatory Capitalism," The ANNALS of the American Academy of Political and Social Science, , vol. 598(1), pages 12-32, March.
    9. Mia Mahmudur Rahim, 2017. "Improving Social Responsibility in RMG Industries Through a New Governance Approach in Laws," Journal of Business Ethics, Springer, vol. 143(4), pages 807-826, July.
    10. Marian Garcia Martinez & Paul Verbruggen & Andrew Fearne, 2013. "Risk-based approaches to food safety regulation: what role for co-regulation?," Journal of Risk Research, Taylor & Francis Journals, vol. 16(9), pages 1101-1121, October.
    11. Linhai Wu & Pingping Liu & Yuxin Lv & Xiujuan Chen & Fu-Sheng Tsai, 2018. "Social Co-Governance for Food Safety Risks," Sustainability, MDPI, vol. 10(11), pages 1-14, November.
    12. AlHussaini, Wissam & Molz, Rick, 2009. "A post-Keynesian regulatory model of privatization," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(2), pages 391-398, March.
    13. Panasiuk Aleksander, 2020. "Policy of Sustainable Development of Urban Tourism," Polish Journal of Sport and Tourism, Sciendo, vol. 27(2), pages 33-37, June.
    14. Hsueh, Che-Fu, 2014. "Improving corporate social responsibility in a supply chain through a new revenue sharing contract," International Journal of Production Economics, Elsevier, vol. 151(C), pages 214-222.
    15. Luc Baumstark & Claude Ménard & William Roy & Anne Yvrande-Billon, 2005. "Modes de gestion et efficience des opérateurs dans le secteur des transports urbains de personnes," Post-Print halshs-00103116, HAL.
    16. Jan Fischer & Simon Guy, 2009. "Re-interpreting Regulations: Architects as Intermediaries for Low-carbon Buildings," Urban Studies, Urban Studies Journal Limited, vol. 46(12), pages 2577-2594, November.
    17. Maciej Czaplewski, 2015. "Oddziaływanie regulacyjne Unii Europejskiej na rynek usług telekomunikacyjnych," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 5, pages 65-87.
    18. Parker, David, 2001. "Economic Regulation: A Preliminary Literature Review and Summary of Research Questions Arising," Centre on Regulation and Competition (CRC) Working papers 30616, University of Manchester, Institute for Development Policy and Management (IDPM).
    19. Ogus, Anthony, 2001. "Regulatory Institutions and Structures," Centre on Regulation and Competition (CRC) Working papers 30704, University of Manchester, Institute for Development Policy and Management (IDPM).
    20. Gowthorp, Lisa & Greenhow, Annette & O’Brien, Danny, 2016. "An interdisciplinary approach in identifying the legitimate regulator of anti-doping in sport: The case of the Australian Football League," Sport Management Review, Elsevier, vol. 19(1), pages 48-60.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    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.

    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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/REAR20 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.