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First External Auditors Of The Hudson's Bay Company, 1866, Gary P. Spraakman

Accounting Historians Journal

At the request of shareholders, the Hudson's Bay Company had its financial statements audited for the first time in 1866. Two external auditors were hired, one for the shareholders and one for management. Three inter-related forces led to this decision: (1) most importantly, the company's shareholders demanded audited financial statements, (2) there was emerging in London at the time the capacity and willingness among London accountants to provide external audit services, and (3) the British Parliament passed various acts that required financial statements of companies in other industries to be audited. After a few years, only the management's external auditor …