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The main aim of this research is to investigate perceptions of respondents (auditors, accountants and financial managers) on the effect of provision of non-audit services (NAS) to audit clients companies upon auditor independence and audit quality. This study expands on previous work done on the effects of providing non-audit services upon auditors' independence and audit quality in Bahrain, which considered as an important subject for both auditing firms and auditing profession. This paper provides insights on the factors which explain the impact of the provision of non-audit services upon auditor independence and audit quality in Bahrain. To achieve the objectives of the research, a questionnaire was prepared and disseminated to a sample of 250 respondents. The results indicate that respondents are supporting the idea that "independence of auditor is impaired with providing non-audit service". Kruskal-Wallis Test revealed that only respondents' occupation is associated with their perceptions. Providing empirical evidence on this issue within the Bahraini environment, as a member of the Gulf Cooperation Council countries, may add a new dimension to the accounting and auditing literature. As the study analysed only one country (Bahrain); generalisation of the results might be a limitation. Future research studies should consider other countries in the region and to include respondents in other non-listed companies with more recent data which may lead to different results.

This study examines the impact of liquidity on Islamic banks" profitability during the years from 2010 to 2015. The study extracted its data from the annual reports of six Islamic banks in Bahrain that have been in operations on or before 2010 to 2015. The liquidity model is built from four liquidity variables namely cash & due from banks to total assets (CDTA), cash & due from banks to total deposits (CDTD), investment to total assets (INVSTA) and investment to total deposits (INVSTD). According to adjusted R squares profitability variables return on assets (ROA), return on equity (ROE) and return on deposits (ROD) are respectively 16.2%, 3.1% and 21.3% dependent on liquidity variables.The results of the study show that CDTD and INVSTD are correlated positively with ROE. In addition, CDTD, INVSTA indicate a negative correlation with ROE. Thus, only INVSTA and INVSTD found to be significant with ROE at 0.05 significant level. Durbin-Watson test shows that the residuals are uncorrelated since its value is approximately very close to 2. However, according to the P-value, the overall liquidity model (Model 2) is not significantly related with ROE. Thus, the null hypothesis (H0) is accepted and the alternative hypothesis is rejected for the ROE. Furthermore, the results in the table show that CDTA and INVSTD are positively correlated with ROD, and negatively with CDTA and INVSTA, and CDTA is the only insignificant variable. CDTD is significantly related with ROD at 10%. Durbin-Watson test shows that the residuals are positive auto -correlated since its value is approximately very close to 1. However, according to the P-value, the overall liquidity model (Model 3), is significantly related with ROD at 1% level.The researcher recommended for further studies to add more liquidity variables to the model so as to enhance and enrich Islamic banks outlook.

Abstract:The Purpose of this paper is to ascertain the perceptions of audit firms on the vexed issue of mandatory rotation of auditors in kingdom of Bahrain. A hand administered questionnaire survey of 102auditors, and accounting professionals was undertaken. Descriptive statistics were used to find out the most common reasons why respondents were agreed or disagreed with the idea of introduction of mandatory rotation of auditors in Bahrain and its effects on audit costs. The findings of the study indicate that there is an association between mandatory rotation of audit firms and audit costs. Analyses of variance (ANOVA) were also conducted to test the possibility of confounding effects arising from participants' background and experience. None of these variables were found to have a confounding effect on the experimental results. The results also reveal that the adoption of rotation rules wasn't given enough attention among the auditing firms in Bahrain. Finally, this study contributes to global debate on mandatory rotation of auditors from the view point of an emerging economy.