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Responses by Australian auditors to the global financial crisis

Author

Listed:
  • Yang Xu
  • Elizabeth Carson
  • Neil Fargher
  • Liwei Jiang

Abstract

type="main" xml:lang="en"> We examine the impact of the global financial crisis (GFC) on auditor behaviour in Australia. Using a sample of listed companies, we examine whether the GFC impacted the propensity of auditors to issue going concern modifications and increased audit effort as reflected in audit fees and audit reporting lag. Controlling for client characteristics, we find an increase in the propensity to issue going concern opinions during the period 2008–2009 compared with the period 2005–2007 and that Big N auditors responded to the GFC earlier than non-Big N auditors. In relation to audit effort, we find evidence of increased audit fees during the period 2008–2009 compared with the period 2005–2007. There is, however, no evidence of increased audit reporting lags during the GFC.

Suggested Citation

  • Yang Xu & Elizabeth Carson & Neil Fargher & Liwei Jiang, 2013. "Responses by Australian auditors to the global financial crisis," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 53(1), pages 301-338, March.
    • Handle: RePEc:bla:acctfi:v:53:y:2013:i:1:p:301-338
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    File URL: http://hdl.handle.net/10.1111/j.1467-629X.2011.00459.x
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    References listed on IDEAS

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