audit rotation

The periodic changing of external auditors. Some countries - Italy and Spain, for example - have traditions of requiring listed corporations to rotate auditors after a defined time period (typically five or seven years) in an attempt to encourage external auditor independence. Rotation of auditors can be costly, however, in terms of the disruption and inefficiencies arising from the *learning curve of a newly appointed auditor unfamiliar with an organization’s activities. Audit rotation can refer to changes of audit firms or changes of audit partners from a single firm.