Corporate Governance Mechanism, Firm Size and Its Effects on Acceptance of Qualified Audit Opinion

This study aims to examine the effect of internal and external corporate governance mechanisms that are proxied by the size of the independent commissioners, the audit committee’s educational background, the proportion of institutional ownership, audit quality, and company size factors towards acceptance of qualified audit opinion. The population in this study is the infrastructure, utilities and transportation sectors listed in the Indonesia Stock Exchange in 2013-2017. Based on the purposive sampling method, it obtained 120 analytical units from the sample data. The analysis used in this study is logistic regression analysis. The results of this study found that if the size of the company which calculated based on total assets had a negative influence on the acceptance of qualified audit opinion. On the other hand, the element of Good Corporate Governance in the form of independent commissioners, audit committee, institutional ownership, and audit quality has no effect on the acceptance of qualified audit opinion. The conclusion of this study is the presence of the company’s internal support body are not able to influence the company’s accounting for the better. Keywords: good corporate governance, qualified audit opinion, firm size

An empirical examination of the determinants of audit report delay in France

Purpose This study aims to investigate the determinants of delay in publishing audited reports. Design/methodology/approach The research is conducted on a sample of French listed companies, covering the period of five years (from 2010 to 2014). The authors use pooled ordinary least squares regression analysis, modeling audit delay as a function of the following explanatory variables relating to the attributes of companies and their auditors. Findings A statistically significant association is found between audit delay and type of audit firm, audit opinion, firm size, the month of year-end and profitability. The results suggest that audit delay lag is reduced by appointing an international audit firm but is extended by aspects of qualified audit opinion. Originality/value The contribution of this paper is to investigate audit report in a developed capital market by taking advantage of access to proprietary data on audit timing and audit opinion. This allowed to overcome some of the problems of data quality that inhibit importing research methods from France to other advanced capital markets.

Audit report qualification/modification

Purpose The purpose of this paper is to investigate the influence of financial variables and especially profitability, loss in current year, loss in previous year, leverage and liquidity in predicting audit report qualifications (qualified audit opinion) and audit report modifications (qualified opinion or unqualified but with an explanatory paragraph). Design/methodology/approach The authors used hand-collected data from financial statements and from auditors’ general reports of 76 non-financial publicly traded companies over a period of 11 years (2005-2015). A total of 545 audit reports were analyzed. Findings The results of panel logistic regression reported a positive relationship between liquidity, loss in the current year, loss in the previous year and a qualified audit report. A positive relationship was found between leverage and audit report modification. Also, the findings show that the Tunisian revolution did not affect the qualification or the modification of the audit report but qualifications decreased significantly during the period of the financial crisis. Practical implications The research has practical implications and can help auditors in identifying factors motivating audit report qualification or audit report modification, mainly in periods of instability. Originality/value This study contributes to auditing research, since the authors know very little about the determinants of audit opinion in emerging and African markets. It constitutes an addition to previous knowledge about audit opinion in the context of Tunisia during two important periods: the financial crisis and revolution. This research is one of the rare studies analyzing qualifications and audit report modifications by considering both qualifications and explanatory paragraphs.

The Impact of Corporate Governance Characteristics on the of Financial Distress

Given the importance of corporate governance for increasing the monitoring of company operations, i.e., reducing information asymmetry and increasing control over operations, in this study, we investigate some indicators of corporate governance and financial distress as one of the most important criteria in the decisions of the users of financial statements. Corporate governance Indicators that have been mentioned in this study, including the independence of the board of directors (the ratio of non-executive members), institutional investors and duality of CEO and Chairman of the Board of Directors. This study is applied research and the required information is gathered from financial statements of listed companies on the TSE. Using a sample of 82 company stock during the period 2010-2014 and multivariate regression analysis, the results of the analysis of information gathered indicates that institutional ownership reduces the financial distress. However, there was no significant relationship between board independence (proportion of outside board members) and the duality of CEO and Chairman of the Board with the financial distress. The results also indicate that financial leverage and a qualified audit opinion increases financial distress and firm size and management performance reduces it.

Determinants of Audit Opinion after the Scandals of Enron: Empirical Validation in the French Context

<p>This study examines the effect of regulatory changes on audit quality in the French context. The evaluation of the risks and the anomalies carried out by the auditors brings them control relating to the financial statements of the company in order to express an opinion on the effectiveness, the regularity, the sincerity and the faithful image of these documents, in a large complexity of the organizations the objective of this research consists in studying the effect of the evolutions of the regulation as regards legal audit on the estimate of the probability of having an opinion of audit with reserve which reinforces the independence of the auditor.</p>A list of hypothesis related to the approached problems is proposed followed by an overview of the different theoretical propositions which are in place. From a sample of French companies in the SBF 250 over the period 2002-2011, the results show that the analysis of the conditions of receiving a qualified audit opinion is determined by: the variables of the financial health of the company, the inventory receivables which indicate the complexity of the audited firm and the characteristics of the audit.