At the same time, a lengthier auditor tenure offers benefits, as well, Whalen points out. Perhaps most obviously, the auditors gain a thorough understanding of their client's industry and business. That can make them less likely to overlook mistakes or wrongdoing. If they notice an entry that seems off, experienced auditors are less easily persuaded that it's normal, he adds.

Studies on mandatory auditor rotation show mixed results, at best. (Note: many of the studies date to 2003; this was the year that requiring audit partners to rotate every five or seven years, depending on their involvement with a client.)

Consider a 2003 study, "," which examined 562 public companies that announced financial statement restatements between January 1997 and October 2001. The study authors concluded, "We find no evidence that changing auditors before the announcement of a restatement affects the likelihood that the auditor (as opposed to the company or the SEC) identifies the need for restatement. Further, we find no evidence suggesting that the nature or severity of a misstatement is related to auditor tenure."

A (now the Government Accountability Office) concluded that "mandatory audit firm rotation may not be the most efficient way to strengthen auditor independence and improve audit quality, considering the additional financial costs and the loss of institutional knowledge of the public company's previous auditor."