The purpose of this review is to synthesise the existing research literature regarding the underlying structure and competitiveness of the Australian audit market. We consider the findings of Australian academic research, which has examined audit fees, non-audit fees, market concentration, auditor choice, auditor switching and audit firm mergers. We identify the key metrics used to evaluate market structure in the academic literature and then document changes in these metrics in the Australian audit market for listed company audits during the period 2000-2011. Our analysis shows that the audit market is both highly segmented and supplier-concentrated. We find that audit fees in Australia have increased over this period, which can be attributed to increased regulation and resulting increased audit effort needed to complete audit engagements in times of regulatory change and more recently, the global financial crisis. We provide regulators, standard setters and the profession with an evidenced-based perspective on the market for the listed company audits, which is an important input into any future proposals to regulate the Australian audit market.

This study investigates the conditions under which transparency contributes to citizens' understanding of financial reporting and examines how this enhanced understanding is associated with public participation. To this end, a survey experiment was conducted in which two attributes of financial reporting transparency (i.e., content clarification and

The last 30 years have seen public sector accounting in many countries undergo considerable change. More recently, some governments adopted accrual accounting and International Public Sector Accounting Standards (IPSAS), some adopted modified International Financial Reporting Standards (IFRS) while others continued with cash-based accounting. New Zealand (NZ) has, for more than two decades, followed a sector neutral approach to financial reporting and standard setting where the same accounting standards were applied to all entities in all sectors: for-profit, not-for-profit and the public sector. This period included the adoption of IFRS by for-profit entities with minor modifications for the public sector. The suitability of IFRS for the public sector has been questioned and, recently, standard setters in NZ decided to adopt a sector-specific standard-setting approach with multiple tiers for each sector. The for-profit sector will continue to follow IFRS but reporting standards for the public sector will be based on IPSAS. In this period of change we sought the views of preparers of public sector financial reports regarding the users of such reports and their preferences for the public sector reporting framework. We also sought the views of the preparers regarding the usefulness of each financial statement for users, and whether the benefits of reporting by their organisations exceeds the costs. The findings indicate support for maintaining IFRS as a basis for reporting in the NZ public sector. However, IPSAS modified to NZ conditions is also perceived as an acceptable option by respondents in this study. The income statement is, in the opinion of the respondents in this study, the most useful statement while cash flows appear to hold little value. A high proportion of respondents believe that the benefits of reporting exceed the costs, which contradicts the view that such reports are mainly compliance documents that provide little value. This finding contributes to the continuing debate on costs versus benefits on the recent introduction of IPSAS as the reporting framework for the public sector and the perceived appropriateness of IPSAS in public sector reporting.

T he literature synthesis in this paper provides an overview of Australian and New Zealand research on the role of audit in corporate governance. Our focus is on interactions between corporate governance and auditing, including external audit, audit committees and internal audit.In recent years, CPA Australia has supported several research synthesis projects to provide information to practitioners and researchers about the accumulated research on topical areas. The projects have been conducted in conjunction with the Auditing and Assurance Special Interest Group of the Accounting and Finance Association of Australia and New Zealand. They included competition in the audit market (Carson et al. 2014); auditor independence (Carey et al. 2014); scepticism and trust (Harding et al. 2016); and auditor reporting (Carson et al. 2016). The project reported in this paper is the fifth synthesis in the series. The findings should be helpful in making recommendations for policy changes and for advice to entities and individuals affected by corporate governance. They also identify directions for future research.There are numerous definitions of corporate governance. However, one that has received widespread acceptance is that by Justice Owens in the Royal Commission on the collapse of HIH Insurance Ltd, which is cited in the Australian Securities Exchange (ASX) Corporate Governance Principles and Recommendations (ASX Corporate Governance Council (CGC) 2014).Corporate governance describes 'the framework of rules, relationships, systems and processes within and by which authority is exercised and controlled in corporations. It encompasses the mechanisms by which companies, and those in control, are held to account' (ASX CGC 2014: 3). Corporate governance is therefore a means by which companies and other entities discharge their accountability to their stakeholders.A key aspect of governance effectiveness relates to the interaction between corporate governance and auditing. How does auditing affect corporate governance and corporate governance affect auditing? The interaction is not straightforward. To some extent, good auditing will lead to recommendations that will lead to improved governance; but alternatively, good governance should lead to directors setting higher standards, including demanding higher-quality auditing. Both internal and external audits could be affected in different ways. Another related issue is whether better governance is a substitute or a complement for auditing. More effective governance should have a performance-related outcome such as improved disclosure, higher accounting quality or possibly better financial performance. A number of previous literature reviews have drawn conclusions about the relationships between governance and auditing, including audit committees, external audit and internal audit. Bédard and Gendron (2010: 200) reported that audit committee existence and expertise make a difference but number of meetings and size of committee do not. However, Ghafran and O'Sullivan (2013) reach...

This study examines whether auditors adjust their effort and pricing decisions for political visibility. We argue, from the behavioural literature, that political visibility will create the need for more justification by auditors. Using data on actual audit fees, hours and billing rates for a sample of New Zealand public sector companies, we find that total audit fees are positively related to the number of press mentions (our proxy for political visibility). Consistent with our expectations we find that audit fees are monotonically related to audit fees. We also find that auditors increase the hours spent on the audit but not billing rates, which further suggests defensive bolstering by auditors. Copyright (c) 2010 The Authors. Accounting and Finance (c) 2010 AFAANZ.