ABSTRACT
In 1841, the first Joint Stock Companies Select Committee was appointed to consider suitable legislation to regulate, for the first time, the activities of all incorporated companies. In 1856 the Companies Act of that year abandoned the concept of compulsory company audits introduced for the first time by the 1844 Act. The reliability of the amateur company audit, with non-accountants acting as auditors and with no formal audit report. De Paula felt at the time that such a report was a confidential one to the shareholders from the auditor and should be for their eyes and ears only. In 1927, Elliott talked of the direct and indirect clients of the company auditor, the former being shareholders and the latter including the business community as a whole, all looking for reliable. There were also indications of the growing awareness of the usefulness of financial accounting information in economic decision-making.
