IDEAS home Printed from https://ideas.repec.org/a/ahd/journl/v1y2020i7p64-72.html
   My bibliography  Save this article

A Literature Review on the Auditor’s Independence Between Threats and Safeguards

Author

Listed:
  • Andreea Claudia CRUCEAN

    (West University of Timișoara)

Abstract

The paper aims to identify the threats to the auditor’s independence and to discuss this subject from a theoretically point of view. Auditor independence is one of the seven principles of professional ethics, necessary to perform a fair and professional audit engagement. In this paper, I have reviewed the literature and analyzed some of the most relevant scientific articles that have researched this topic. For the case study, I chose to analyze the most relevant papers in this area taking into account the objective pursued by the author, the research methodology, the selected sample, the variables and the category of threats to auditor independence. Subsequently, were split the discovered threats into groups and identified a series of safeguards to limit the threats to the auditor’s independence. The main conclusion is that an in-depth knowledge, the exercise of the procedures for mitigating the effects of threats to the auditor’s independence and compliance with professional and ethical rules are factors that ensure the successful performance of an audit process.

Suggested Citation

  • Andreea Claudia CRUCEAN, 2020. "A Literature Review on the Auditor’s Independence Between Threats and Safeguards," CECCAR Business Review, Body of Expert and Licensed Accountants of Romania (CECCAR), vol. 1(7), pages 64-72, July.
    • Handle: RePEc:ahd:journl:v:1:y:2020:i:7:p:64-72
    DOI: 10.37945/cbr.2020.07.08
    as

    Download full text from publisher

    File URL: https://www.ceccarbusinessreview.ro/a-literature-review-on-the-auditorrsquos-independence-between-threats-and-safeguards-a55d/download-PDF/
    Download Restriction: no
    File URL: https://www.ceccarbusinessreview.ro/a-literature-review-on-the-auditorrsquos-independence-between-threats-and-safeguards-a55a/abstract/
    Download Restriction: no
    File URL: https://libkey.io/10.37945/cbr.2020.07.08?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Legoria, Joseph & Rosa, Gina & Soileau, Jared S., 2017. "Audit quality across non-audit service fee benchmarks: Evidence from material weakness opinions," Research in Accounting Regulation, Elsevier, vol. 29(2), pages 97-108.
    2. DeAngelo, Linda Elizabeth, 1981. "Auditor size and audit quality," Journal of Accounting and Economics, Elsevier, vol. 3(3), pages 183-199, December.
    3. Emmanuel Austin & Siriyama Kanthi Herath, 2014. "Auditor independence: a review of literature," International Journal of Economics and Accounting, Inderscience Enterprises Ltd, vol. 5(1), pages 62-74.
    4. Chang, Yu-Shan & Chiang, Chia-Yu & Liu, Li-Lin (Sunny) & Xie, Xinmei (Lucy), 2019. "Audit partner independence and business affiliation: evidence from Taiwan," Advances in accounting, Elsevier, vol. 46(C), pages 1-1.
    5. Dogui Kouakou & Olivier Boiral & Yves Gendron, 2013. "ISO auditing and the construction of trust in auditor independence," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 26(8), pages 1279-1305, October.
    6. Jiang, Haiyan & Habib, Ahsan & Zhou, Donghua, 2015. "Accounting restatements and audit quality in China," Advances in accounting, Elsevier, vol. 31(1), pages 125-135.
    7. Jamel Azibi & Hubert Tondeur & Hamza Azibi, 2017. "The Impact of the H3C on Auditor Independence in French Context," Journal of Management and Sustainability, Canadian Center of Science and Education, vol. 7(2), pages 105-115, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Joseph Weber & Michael Willenborg & Jieying Zhang, 2008. "Does Auditor Reputation Matter? The Case of KPMG Germany and ComROAD AG," Journal of Accounting Research, Wiley Blackwell, vol. 46(4), pages 941-972, September.
    2. Ebrahim, Ahmed & Fattah, Tarek Abdel, 2015. "Corporate governance and initial compliance with IFRS in emerging markets: The case of income tax accounting in Egypt," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 24(C), pages 46-60.
    3. Mohd Hassan Che Haat & Rashidah Abdul Rahman & Sakthi Mahenthiran, 2008. "Corporate governance, transparency and performance of Malaysian companies," Managerial Auditing Journal, Emerald Group Publishing, vol. 23(8), pages 744-778, September.
    4. Chen, Tao, 2023. "Common auditors and internal control similarity: Evidence from China," The British Accounting Review, Elsevier, vol. 55(2).
    5. Kane, Gregory D. & Velury, Uma, 2004. "The role of institutional ownership in the market for auditing services: an empirical investigation," Journal of Business Research, Elsevier, vol. 57(9), pages 976-983, September.
    6. Ju Ryum Chung & Eun Jung Cho & Ho-Young Lee & Myungsoo Son, 2017. "The impact of labour unions on external auditor selection and audit scope: evidence from the Korean market," Applied Economics, Taylor & Francis Journals, vol. 49(48), pages 4833-4850, October.
    7. Sang Cheol Lee & Mooweon Rhee & Jongchul Yoon, 2018. "Foreign Monitoring and Audit Quality: Evidence from Korea," Sustainability, MDPI, vol. 10(9), pages 1-22, September.
    8. Gerry Gallery & Emerson Cooper & John Sweeting, 2008. "Corporate Disclosure Quality: Lessons from Australian Companies on the Impact of Adopting International Financial Reporting Standards," Australian Accounting Review, CPA Australia, vol. 18(3), pages 257-273, September.
    9. Scott Whisenant & Srinivasan Sankaraguruswamy & K. Raghunandan, 2003. "Evidence on the Joint Determination of Audit and Non‐Audit Fees," Journal of Accounting Research, Wiley Blackwell, vol. 41(4), pages 721-744, September.
    10. Chen, Long & Krishnan, Gopal V. & Yu, Wei, 2018. "The relation between audit fee cuts during the global financial crisis and earnings quality and audit quality," Advances in accounting, Elsevier, vol. 43(C), pages 14-31.
    11. Atanasko Atanasovski, 2013. "Determinants Of Financial Reporting Quality For Listed Entities In Macedonia: Evidence From Fair Value Accounting," Journal Articles, Center For Economic Analyses, pages 23-36, December.
    12. D'Agosto, Elena, 2007. "Auditing Issues across Countries: an Explorative Approach to the Regulation Framework," MPRA Paper 50989, University Library of Munich, Germany.
    13. Anis Ben Amar & Mohamed Chabchoub, 2016. "Audit Quality and Earnings Management to Avoid Losses and Earnings Decreases: The French Case," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 6(4), pages 20-27, October.
    14. Omesh Kini & Shehzad Mian & Michael Rebello & Anand Venkateswaran, 2009. "On the Structure of Analyst Research Portfolios and Forecast Accuracy," Journal of Accounting Research, Wiley Blackwell, vol. 47(4), pages 867-909, September.
    15. Inesa TOFĂNICĂ & Emil HOROMNEA, 2020. "The effect of IFRS application on turnover figures of Romanian companies," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 12(2), pages 156-166, September.
    16. Zhang, Yiyang & Perols, Johan & Robinson, Dahlia & Smith, Thomas, 2018. "Earnings management strategies to maintain a string of meeting or beating analyst expectations," Advances in accounting, Elsevier, vol. 43(C), pages 46-55.
    17. Curtis Hall & J. Scott Judd & Jayanthi Sunder, 2023. "Auditor conservatism, audit quality, and real consequences for clients," Review of Accounting Studies, Springer, vol. 28(2), pages 689-725, June.
    18. Michael Minnis, 2011. "The Value of Financial Statement Verification in Debt Financing: Evidence from Private U.S. Firms," Journal of Accounting Research, Wiley Blackwell, vol. 49(2), pages 457-506, May.
    19. 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.
    20. Garcia-Blandon, Josep & Argiles-Bosch, Josep Maria & Castillo-Merino, David & Martinez-Blasco, Monica, 2017. "An Assessment of the Provisions of Regulation (EU) No 537/2014 on Non-audit Services and Audit Firm Tenure: Evidence from Spain," The International Journal of Accounting, Elsevier, vol. 52(3), pages 251-261.

    More about this item

    Keywords

    auditor independence; ethics; threats; safeguards;
    All these keywords.

    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ahd:journl:v:1:y:2020:i:7:p:64-72. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Radu CIOBANU (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.