Safeguarding Auditor Independence: A Closer Look at Article 15 of Cambodia’s Accounting and Auditing Law
Article 15 of Cambodia’s Law on Accounting and Auditing is a key safeguard designed to uphold the independence, objectivity, and ethical standards of auditors. This provision imposes strict rules that all audit firms and entities subject to audit must understand and comply with.
Under this article, auditors are prohibited from auditing any enterprise or not-for-profit organization for which they have previously provided accounting services, unless those services were completed at least three years prior.
This restriction aims to eliminate self-review threats, where an auditor might be in a position to audit their own past work.
Additionally, auditors could not audit the same client for more than five consecutive years. This mandatory rotation policy helps prevent overfamiliarity and promotes auditor independence and fresh perspectives in the audit process.
Most critically, auditors who hold direct or indirect financial interests or managerial influence—through themselves, their spouses, or relatives up to the third degree—are barred from auditing those entities. This rule targets both actual and perceived conflicts of interest that could compromise audit quality.
These entities must ensure compliance by establishing internal policies to track audit tenure, review prior service relationships, and perform conflict-of-interest checks before audit engagements.
Article 15 brings Cambodian auditing practices closer to international ethical standards, reinforcing investor confidence and promoting transparency in the financial reporting ecosystem.
Herewith the detail of article 15 of Cambodia’s Accounting Law
“Article15.
Auditors shall not conduct auditing services for any enterprises or not-for-profit organizations that the auditors have previously provided accounting services unless those accounting services were completed at least three years prior.
Auditors shall not conduct services for enterprises or not-for-profit organizations for a period exceeding consecutive five years.
Auditors, who have direct or indirect interests or management rights through their spouses or relatives or relatives by marriage up to a 3rd level, shall not conduct auditing services for those enterprises or not-for-profit organizations.”