Perceptions of Auditing and the Provision of Non-Audit Services: Case Study in Libya

Sawan, Nedal; Alzeban, Abdulaziz; Hamuda, Khaled

doi:10.5539/ijbm.v8n14p168

Cited by 3 publications

(2 citation statements)

References 45 publications

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“…This result indicates that respondents support the idea that audit quality is enhanced and auditor objectivity is improved if NAS were provided by the auditor. The above result is consistent with most previous studies (Hartley & Ross, 1972;Goldman & Barlev, 1974;Glezen & Millar, 1985;Gul, 1989;Wallman, 1996;Antle et al, 1997;Arrunada, 1999;Sawan et al, 2013). These results can be justified since the auditor's awareness and knowledge of the client's company would be improved by the provision of NAS, leading to increase objectivity and independence (Goldman & Barlev, 1974); that providing NAS would lead to improve audit quality (Antle et al, 1997); or that the auditor provision of NAS to their audit clients decreases total costs, increase technical competence and motivates more intense competition (Arrunada, 1999).…”

Section: The Overall Samplesupporting

confidence: 93%

“…Palmrose and Saul (2001) indicated that the arrangements in which audit firms delivered, both audit and NAS, the NAS has a supportive influence on the effectiveness of the audit. Sawan, Alzeban and Hamuda (2013) found that the provision of NAS improves audit quality. Furthermore, some forensic auditors testified that specific types of frauds might have been eliminated or identified if NAS had been delivered to the audit client or if well communication had ensued between NAS personnel and the audit engagement team (Joshi et al, 2007).…”

Section: Audit Quality Is Improved and Enhanced By Rendering Nasmentioning

confidence: 99%

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Does the Provision of Non-Audit Services Affect Auditor Independence and Audit Quality? Evidence from Bahrain

Khasharmeh¹,

Desoky²

2018

AAMJAF

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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.

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Section: The Overall Samplesupporting

confidence: 93%

Section: Audit Quality Is Improved and Enhanced By Rendering Nasmentioning

confidence: 99%

Does the Provision of Non-Audit Services Affect Auditor Independence and Audit Quality? Evidence from Bahrain

Khasharmeh¹,

Desoky²

2018

AAMJAF

View full text Add to dashboard Cite

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The Effect of Pure Audit Firms, Non-Provision of Non-Audit Services to Audit Clients, and a Fee Schedule on Audit Quality Perceptions

Pappert

Quick

2021

SSRN Journal

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The Effect of Pure Audit Firms, Nonprovision of Nonaudit Services to Audit Clients, and a Statutory Fee Schedule on Audit Quality Perceptions

Pappert,

Quick

2024

Journal of International Accounting Research

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An ongoing debate revolves around instruments for enhancing the audit quality perceptions of financial statements users. Therefore, we investigate two measures that lack empirical evidence, but could theoretically improve perceived audit quality. These are a nonprovision of NAS (either by pure audit firms, or a nonprovision of NAS to audit clients) and a statutory fee schedule. We conduct an experiment with German bankers and nonprofessional investors. The results indicate that a nonprovision of NAS to audit and to all clients (i.e., pure audit case) increases perceived audit quality only if the audit firm sets audit fees internally. Moreover, a statutory fee schedule only increases perceptions of audit quality in the case of a simultaneous provision of audit services and NAS. Consequently, instead of full-banning NAS, an alternative approach would be to introduce a statutory fee schedule that would still permit the provision of NAS while adhering to existing caps. JEL Classifications: M42; M48.

show abstract

Perceptions of Auditing and the Provision of Non-Audit Services: Case Study in Libya

Cited by 3 publications

References 45 publications

Does the Provision of Non-Audit Services Affect Auditor Independence and Audit Quality? Evidence from Bahrain

Does the Provision of Non-Audit Services Affect Auditor Independence and Audit Quality? Evidence from Bahrain

The Effect of Pure Audit Firms, Non-Provision of Non-Audit Services to Audit Clients, and a Fee Schedule on Audit Quality Perceptions

The Effect of Pure Audit Firms, Nonprovision of Nonaudit Services to Audit Clients, and a Statutory Fee Schedule on Audit Quality Perceptions

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