Auditing

When you audit a company, when you certify their figures, what you are doing is stamping your credibility on it. You are shouting to the World "You all know me, and you know I don't lie. And I hereby say that, having thoughly examined this company, it, on itself, is not lying".

Credibility is central to auditing business. There is nothing on it as one reputation. And one earns it through years of meticuluous and successful books examinations, warehouse stock counting, documents and bills checking and cross-checking. It is not easy to achieve. And it is one's most important asset in this business. People will hire you for your reputation, for the undisputable stamp of quality you put on ones results, for the beyond any doubt assertion you do to their books.

So there isn't anything more important than its reputation and credibility for an auditor. Still, it is interesting to see a situation like the Banco Português de Negócios', where you can find competent auditors who did their business and even contradicting their hirers intention issued warnings on their situation (like Delloitte did in 2003, and being 'fired' for that) and others who, for 4 consecutive years, referenced the 'good health' of BPN's accounts - something we now are sure wasn't the true.

The auditors performed their job at BPN - some of them rather poorly. Because of that, the faulty auditors credibility is not much of a value nowadays, and all the companies it certified over the last years are shadowed by its bad practice - their accounts are not trustworhty anymore. Let's see where this ends up for this auditing company - but we all watched what happened to Andersen a few years ago on Enron's...