We develop a theoretical model to compare the relative merits of a system that requires auditor rotation to one that does not. We show that auditor independence is improved with mandatory rotation, but that the net benefit is sensitive to the rotation period, startup cost, the cost associated with biased reports, auditors' learning, and the time span of managers' incentives. Mandatory auditor rotation is preferable if the rotation period is long, startup costs are high, the cost of biased reports is high, auditor learning is dramatic in terms of improving audit efficiencies over time, and the manager is myopic (focused on short-term payoffs).