Discussant's response to the evolution of audit reporting;

              Discussant's Response to
The Evolution of Audit Reporting
J. Alex Milburn
Clarkson Gordon, Toronto
I read this paper, and then sat back and thought about how to go about commenting on it. I had to recognize that I faced some formidable disadvan­tages.
First, the subject of the paper is the evolution of audit reporting in the United States—and I am an accountant from a remote foreign land. Second, the authors could not be more knowledgeable on the subject. Doug Carmichael, in particular, has been part of this evolution for quite some time. Who could know better than the authors how the audit report has evolved? I can hardly challenge their facts and they are clearly in a much better position than I to interpret these facts.
Buoyed up by these thoughts, I began by asking myself some basic first principle kinds of questions—like what am I doing here? I thought about questioning the purposes of tracing this evolution in the first place. What is the interest in it? What good can come of it? Perhaps I can set up some ideal purposes that the paper cannot meet. Certainly, I need some basis for judging whether this is a good evolution evaluation or not. Otherwise it is like trying to judge "presents fairly" without "GAAP."
Naturally, I turned to the FASB conceptual framework. (This is the beauty of this developing framework—everything can be explained by it.) I think there is some application of the FASB framework to this paper. In particular, I presume that the paper attempts to present historical information in a way that will help us evaluate the profession's past performance and future prospects. Perhaps the paper's usefulness should be judged in terms of whether it helps us to see what audit reporting may be evolving towards, and in terms of whether it improves our basis for making decisions as to desirable future efforts towards improving reporting standards. So we might ask whether this paper is useful in this sense.
As I thought more about this, another basic question occurred to me—what are the authors really trying to demonstrate here? Is there a hidden agenda? I get the impression of a feeling of a little frustration, and perhaps a touch of bewilderment, on the part of the authors. A basic message in the paper is that there have been no significant improvement changes in the audit report in 33 years and that to them "a crucial question is why" (p. 1). They cite significant evidence of misunderstanding of the audit report going back to the mid 1960's—and they describe two major attempts at revision since then that have failed. Thus, they raise some serious concerns.
Focus of the Paper
I think it very important to identify the focus of this paper because I am going to argue that it is too narrow. The authors have concentrated on the
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