Audit firm rotation and audit report: evidence from the Tehran Stock Exchange

Mohammadi, Saman; Maharlouie, M. M.; Noori, Sepideh Kazemi

doi:10.1080/10291954.2015.999451

Cited by 3 publications

(2 citation statements)

References 18 publications

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“…Exactly half of the studies reviewed (14 out of 28) adopted panel data analysis via a logistic regression (Ferguson et al, 2017), a multivariate regression (Zhang et al, 2017), chi-square distribution test (Mohammadi et al, 2015) or correlation (Reid & Carcello, 2017).…”

Section: Methodsmentioning

confidence: 99%

“…There were three main findings: some studies found that AR led to high levels of audit quality (Kim et al, 2015;Mohammadi et al, 2015;Cameran et al, 2016); others found that there was no increase in audit quality due to AR ( Jenkins & Vermeer, 2013;Omri & Abdennebi, 2014;Velte & Freibank, 2015). Another group of studies found that in situations where previously rotated auditors come back to their former clients after a required "cooling-off period", audit quality tends to decline (Firth et al, 2012;Zhang et al, 2017).…”

Section: Ar Research Themesmentioning

confidence: 99%

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Audit retention versus audit rotation - an update of the debate

Zubairu¹,

Ochepa²,

Umar³

et al. 2019

jafas

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In this paper, an update is provided on the ongoing debate between audit retention and audit rotation in different parts of the world. Design and Methodology: This update is provided based on a systematic review of recent scholarship that have explored the supposed benefits or drawbacks of audit rotation amidst a climate of declining confidence in audited financial statements due to a series of financial scandals over the last few years. 28 articles were examined along four key categories, including the geographical distribution of the articles, article type, research themes and research methods. Findings: The findings of the review revealed that the debate between audit rotation and retention has no end in sight with empirical studies finding conflicting results regarding the merits or demerits of adopting a mandatory audit rotation regime in various countries. A recurring message amongst many of the studies is that perhaps time has come for the auditing profession to seek an alternative solution for maintain auditor independence. Practical Implications: A recurring message amongst many of the studies is that perhaps time has come for the auditing profession to seek an alternative solution for maintaining auditor independence. The Significance of The Study: This study reveals that auditor independence cannot be obtained merely by regulation. This is evidenced by the fact that audit-related financial scandals have continued to occur over this long period of time, despite the adoption of mandatory audit rotation in many parts of the world.

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Section: Methodsmentioning

confidence: 99%

Section: Ar Research Themesmentioning

confidence: 99%

Audit retention versus audit rotation - an update of the debate

Zubairu¹,

Ochepa²,

Umar³

et al. 2019

jafas

View full text Add to dashboard Cite

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The impact of auditor rotation, audit firm rotation and non-audit services on earnings quality, audit quality and investor perceptions: A literature review

Velte¹,

Loy²

2018

JGR

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This literature review evaluates 103 empirical research studies on the link between rotation and non-audit services on the one hand and their influence on earnings quality, audit quality and investor perceptions on the other hand. After the financial crisis 2008/09, regulators all over the world are aware of decreased stakeholder trust in earnings and audit quality. As a reaction, stricter rules on rotation and non-audit services by public interest entities (PIEs) have been implemented (e.g. in the European Union). However, the impact of these regulations on earnings and audit quality is still controversial. We briefly introduce the theoretical, normative and empirical audit framework that comprises an adequate structure of the state-of-the-art of empirical research in this field. We summarize the findings in each research area, while we split our rotation analysis in an audit firm and audit partner rotation and tenure and our dependent variables in earnings quality, audit quality and investor perception measures. Most of the cited studies are linked to earnings-related measures, especially abnormal accruals models. The mixed results can be explained by the different theoretical impacts of agency- and resource-based view. Finally, we will discuss the current limitations of the studies and give useful recommendations for future empirical research activities on this topic.

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Audit Report Delay and Audit Firm Rotation in Turkey

Tuan¹,

Memiş²,

Kaygusuz³

et al. 2020

Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi

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Lengthy delays in the publication of financial reports may adversely affect the efficiency of capital markets. The current study investigates the effect of auditing firm rotation on financial report disclosure dates. Accordingly, 1,200 company-year observations obtained from annual reports of non-financial institutions traded on the Borsa Istanbul for the years 2010-2017 are analyzed. The results of the current study indicate that there is a statistically significant positive relationship between financial report disclosure dates and audit firm rotation. In other words, financial report delay is longer following audit firm rotation. The results of the study are expected to provide benefits to regulatory authorities in the publication of timely financial reports necessary for the effective functioning of the capital market.

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Audit firm rotation and audit report: evidence from the Tehran Stock Exchange

Cited by 3 publications

References 18 publications

Audit retention versus audit rotation - an update of the debate

Audit retention versus audit rotation - an update of the debate

The impact of auditor rotation, audit firm rotation and non-audit services on earnings quality, audit quality and investor perceptions: A literature review

Audit Report Delay and Audit Firm Rotation in Turkey

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