Concentration of the Audit Market: Evidence from Serbia

Mijić, Kristina; Jakšić, Dejan; Vuković, Bojana

doi:10.1515/ethemes-2014-0008

Cited by 3 publications

(6 citation statements)

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“…Concentration on the market of auditing services can also be measured by the market share of the BIG4 companies, i.e., PricewaterhouseCoopers, Deloitte, KPMG, and Ernst & Young [Financial Reporting Council, 2010;Indyk, 2019] and using the "10KAP" ratio, which means the share of the ten key audit companies in the audit market, i.e., Baker Tilly; BDO; Ernst & Young; Deloitte; Grant Thornton; KPMG; Mazars; Moore Stephens; Nexia; and PricewaterhouseCoopers [European Commission, 2017]. In the study prepared by the OECD [1993], it is recommended to use two indices to study the concentration on the audit services market, i.e., CR k and HHI, of which the CR k index is most often used in the literature [Mijic et al, 2014;Paunescu, 2015;Malis and Brozovic, 2015;Groff and Salihovic, 2016;European Commission, 2017, 2021. The CR k ratio means the consolidated market share of the k largest audit firms.…”

Section: Methods Of Measuring Concentration On the Market Of Audit Se...mentioning

confidence: 99%

“…Companies that choose one of the auditing companies from the BIG4 do not focus on costs, but on the quality of audit services, auditors' competences, or international reputation [Mijic et al, 2014].…”

Section: The Problem Of Concentration On the Market Of Auditing Servi...mentioning

confidence: 99%

“…It is noted in the literature that one of the factors that cause changes in the level of concentration on the audit services market is the rotation of audit firms, which strengthens the independence of auditors [Mijic et al, 2014].…”

Section: The Problem Of Concentration On the Market Of Auditing Servi...mentioning

confidence: 99%

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Concentration on the market of audit services provided to publicly listed companies: Evidence from Poland

Gad

2023

International Journal of Management and Economics

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Paper's objectives The main purpose of the article was to identify the level of concentration on the market of audit services provided to public companies listed on the Warsaw Stock Exchange. The additional aim of the article was to identify the level of rotation among companies providing audit services to public companies listed on the Warsaw Stock Exchange. Methods applied The research conclusions were formulated based on the analysis of 3,960 annual reports prepared in the years between 2011 and 2019 by companies listed on the Warsaw Stock Exchange. Findings The study found that over the years from 2011 to 2016 the concentration (measured by BIG4, CR4, CR8, and 10KAP indicators) on the market of auditing services provided to public companies increased. However, as of 2017, this concentration began to decline. This demonstrates the effectiveness of the new regulations on the audit market. In the analyzed period, eight audit firms, referred to in the article as “leading”, provided their services to an average of >62% of public companies. Their share in the market of auditing services varied from sector to sector. At the turn of 2016 and of 2017, a significant increase in the level of rotation on the market of audit services provided to public companies was observed. This level varied from sector to sector. Originality/value The literature on the subject has not yet presented a comprehensive analysis of the impact of EU directives on the structure of the Polish market of audit services provided to public companies. This issue is a research gap, which has been filled in this article.

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Section: Methods Of Measuring Concentration On the Market Of Audit Se...mentioning

confidence: 99%

Section: The Problem Of Concentration On the Market Of Auditing Servi...mentioning

confidence: 99%

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Concentration on the market of audit services provided to publicly listed companies: Evidence from Poland

Gad

2023

International Journal of Management and Economics

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“…Another research that has been conducted is the research on market concentration of audit services in the Republic of Serbia by Mijić, Jakšić and Vuković (2014). The authors selected the Herfinadahl-Hirschman index and CR as the main indicators to measure concentration, considering four independent variables: operating income, net earnings, number of employees and number of audit clients.…”

Section: Audit Market Concentration In International Researchmentioning

confidence: 99%

“…This research covered the period 2008-2011. Mijić, Jakšić and Vuković (2014) report that the HHI (0.12) and CR 2011 (65.56%), i.e., more than 2/3 of the total operating revenues were common to the Big 4 and had higher audit fees than other audit firms. For the other variables, in the case of concentration measurements, the Big Four were not dominant.…”

Section: Audit Market Concentration In International Researchmentioning

confidence: 99%

The Measure of Concentration of Audit Markets in Public Interest Entities in the Czech Republic and Slovakia

Dostálová,

Formanová,

Mádr

et al. 2023

Danube

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The aim of the paper is to determine whether the audit market for public interest entities in the Czech and Slovak Republic has been still concentrated and subsequently to determine the measure of concentration. The article consists of data including information from audit entities that perform statutory audit of public interest entities in the Czech Republic and Slovakia on timeline 2017–2020. On the level of competition is identified by the Herfindahl-Hirschman Index and the CR4 Index, using the revenues of statutory audit as a basis for calculating market shares. The results show that the Czech and Slovak audit markets for public interest entities have been highly concentrated, with a higher measure of concentration in the Czech Republic (HHI 0.25) than in Slovakia (HHI 0.23). The Big Four has had a market share of between 90% (Slovakia) and 95% (Czech Republic) in both countries, with the four firms have been providing up to 70% of all statutory audits within public interest entities. At the same time, KPMG and PWC have had the strongest market position. The paper provides new evidence on audit market concentration of public interest entities in the Czech Republic and Slovakia in the context of development in recent years, and thus can be the basis for a subsequent discussion of the consequences associated with high market concentration.

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The market for audit services provided to public companies listed on the Polish capital market

Gad¹

2018

ZTR

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The aim of the article is to identify changes in the concentration on the market for audit services provided to public companies listed on the Warsaw Stock Exchange. The additional aim is to identify changes in the level of rotation among firms providing audit services to public companies listed on the Warsaw Stock Exchange. The research conclusions were based on the analysis of 2 652 annual reports prepared in the years 2011-2016 by companies listed on the Warsaw Stock Exchange. Reports came from the websites of the surveyed companies. The data was collected manually. It was found that in the years 2011–2016 the concentration in the market for audit services provided to public companies increased. Six audit firms, referred to in the article as “leading” firms, provided their services to over half of public companies. Their share in the audit services market varied across sectors. The level of rotation of audit firms providing their services to public companies in particular sectors was also different. It should be pointed out that the level of concentration in the market for audit services provided to public companies in Poland is lower than the average level of concentration for all EU countries. In Poland, in 2015, the CR4 indicator was around 41%, while the average value of this indicator for the EU countries was around 70%. So far, there has been no comprehensive analysis of the Polish audit services market in the relevant literature. This article seeks to fill a research gap in this respect.

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Concentration of the Audit Market: Evidence from Serbia

Cited by 3 publications

References 5 publications

Concentration on the market of audit services provided to publicly listed companies: Evidence from Poland

Concentration on the market of audit services provided to publicly listed companies: Evidence from Poland

The Measure of Concentration of Audit Markets in Public Interest Entities in the Czech Republic and Slovakia

The market for audit services provided to public companies listed on the Polish capital market

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