Please use this identifier to cite or link to this item: http://buratest.brunel.ac.uk/handle/2438/13082
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dc.contributor.authorNiemi, L-
dc.contributor.authorKnechel, WR-
dc.contributor.authorOjala, H-
dc.contributor.authorCollis, J-
dc.coverage.spatialFribourg-
dc.date.accessioned2016-08-16T11:18:57Z-
dc.date.available2016-08-16T11:18:57Z-
dc.date.issued2016-
dc.identifier.citation12th Annual Workshop on Financial Reporting in Europe, 2016en_US
dc.identifier.urihttp://bura.brunel.ac.uk/handle/2438/13082-
dc.description.abstractWe examine the effect of changes in the regulatory environment on the conduct of financial statement audits in a European setting. These changes include the adoption of risk-based auditing, new Audit Risk Standards and increased scrutiny of audit quality by a new, co-ordinated oversight body in each Member State. We investigate this by analysing the audit hours and fees and their determinants for clients of Big N audit firms in Finland in 1996 and 2010. Our results show that audit fees and audit effort by senior auditors were generally higher for high risk clients in 2010 than in 1996. Second, we find that the relationship in 1996 between the client being owner-managed and lower audit hours for both senior and junior auditors is absent in 2010. This supports our argument that the increased auditor scepticism has increased audit effort for owner-managed firms. Third, we find that the average number of junior staff hours increased between 1996 and 2010, but the variance across engagements declined. In contrast, senior auditor hours (and total audit hours) decreased, but the variance across engagements increased. This supports the view that risk-based auditing has increased the efficiency of audits. However, it suggests that the general increase in regulation and the tightening of audit standards, reinforced by the new quality inspections, have led to less emphasis on processes requiring professional judgment and more emphasis on compliance with rules. These unintended consequences should be of interest to the auditing profession and policy makers.en_US
dc.language.isoenen_US
dc.source12th Annual Workshop on Financial Reporting in Europe-
dc.source12th Annual Workshop on Financial Reporting in Europe-
dc.subjectAudit efforten_US
dc.subjectAudit regulationen_US
dc.subjectBusiness risken_US
dc.subjectStandardization of audit servicesen_US
dc.titleUnintended consequences of changes in the regulatory landscape on the statutory audit processNieen_US
dc.typeConference Paperen_US
pubs.finish-date2016-09-02-
pubs.finish-date2016-09-02-
pubs.publication-statusUnpublished-
pubs.start-date2016-09-01-
pubs.start-date2016-09-01-
Appears in Collections:Brunel Business School Research Papers

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