IntroductionThe financial crisis that began in 2007 has seriously undermined the integrity of the financial system. Measures have therefore been suggested, some adopted, to regulate various players in this sector, in the hope of avoiding the recurrence of such events. In particular, the roles of banks, regulatory institutions (such as the central bank), rating agencies and hedge funds were promptly examined and recommendations were proposed. However, an important player, the auditing firms, seems to have escaped the investigation. In September 2011, things went differently when a radical audit reform proposed by a Commissioner for Internal Market and Services of the European Commission, Michael Barnier, was leaked (Fielding 2011; European Commission 2011a). his proposal Barnier considers audit firms as the dogs that did not bark during the financial crisis, thus casting doubt on their effectiveness (Fielding 2011). He argues that auditors should have played a greater role in warning about their clients' unhealthy financial position. Instead they offered laudable audit reports followed almost immediately by large losses reported by the institution particularly from 2007 to 2009 (European Commission 2011a). Considering that between 2008 and 2009 large sums of taxpayers' money, amounting to 4,5888.9 euros, were used to support these banks, it believes it is essential to analyze all the components of the financial system and propose the necessary reforms. According to Barnier, the implementation of the reforms will restore confidence especially in the financial sector. Investors and other interested parties will be able to easily and cost-effectively access companies...... middle of paper ......s, H. (2011) 'Four big auditors face huge reorganisations. ' Reuters. [online] September 27. [Accessed 10 August 2012] http://uk.reuters.com/article/2011/09/27/eu-auditing-idUKL5E7KR2FB20110927Stokdyk, J. (2011). Retaliation kicks off in EU's first audit reforms'. Web Accounting. [online]. 5 October [Accessed 10 August 2012] http://www.accountingweb.co.uk/blog-post/retaliation-kicks-early-eu-audit-reformsThe Economist. (2011) “Auditor Rotation: Musical Chairs.” The economist. [online] 3 September [Accessed 10 August 2012] http://www.economist.com/node/21528279Thompson, S. (2011) FTSE 100 audit committee chairs question logic of UK audit reforms EU. ICAEW [online] [Accessed 10 August 2012] http://www.icaew.com/en/about-icaew/newsroom/press-releases/2011-press-releases/ftse-100-audit-comittee-chairs-question -rational-eu-reforms