Statistical Exploration of the Audit Market to Assess the Auditor Independence

Author:Univ. Prof. Elisabeta JABA, Ph. D., Ioan-Bogdan ROBU, Ph. D. Student

JEL:C 35, C 53, M 42

DOI:

Keywords:audit market, profitability, profile, factor analysis, discriminant analysis, independence, analyse of variance

Abstract:
The development of the capital market and the need of the stakeholders to know the true wealth determined the foundation and the increasing the role of the audit firms, by reducing the information gap. The beginning of the international financial crisis produced a series of changes to the performance indicators of the audit firms from Romania, with negative effects on their profitability. In this study, starting form a sample of 125 audit firms from Romania, structured as belonging to a certain region of the country, it was proposed the exploration of audit market for assessing the auditor independence.\r\nThis objective can be achieved by identifying the financial profile of an audit firm, according to the registered profitability in 2008 and 2009, by the classification of the audit firms into performance groups according to the return on assets criteria, and by studying the relationship between the classification of the firms into profitability groups and the level of the receivables in total assets. The data were processed with SPSS 19.0.\r\nThe results obtained in the study, the profile identification and the classification functions, can be used to assess the performance of an audit firm, which is a condition for maintaining auditor independence, with a directly impact on the audit quality.\r\n\r\n\r\n

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