Impact of Auditor and Audit Firm Rotation on Accounting and Audit Quality: A Critical Analysis of the EC Regulation Draft
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Impact of Auditor and Audit Firm Rotation on Accounting and Audit Quality : A Critical Analysis of the EC Regulation Draft. / Velte, Patrick; Stiglbauer, Markus.
In: International Journal of Regulation and Governance, Vol. 1, No. 3, 01.01.2012, p. 7-13.Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Impact of Auditor and Audit Firm Rotation on Accounting and Audit Quality
T2 - A Critical Analysis of the EC Regulation Draft
AU - Velte, Patrick
AU - Stiglbauer, Markus
PY - 2012/1/1
Y1 - 2012/1/1
N2 - In a current regulation draft of 2011, the European Commission (EC) plans the mandatory audit firm rotation principally after six years and with regard to a cooling off period of four years toincrease auditor independence. This could complement the internal mandatory rotation (auditor rotation) by the 8th EC directive. The present paper gives a state of the art analysis of the empirical research results with regard to auditor and audit firm rotation. In contrast to the perception of the EC, the majority of the empirical results doesn’t find evidence for increasedfinancial accounting and audit quality by audit firm rotation. Furthermore, the positive effects of the internal rotation period of seven years and the cooling off period of two years by the 8th ECdirective are not empirically proved yet.
AB - In a current regulation draft of 2011, the European Commission (EC) plans the mandatory audit firm rotation principally after six years and with regard to a cooling off period of four years toincrease auditor independence. This could complement the internal mandatory rotation (auditor rotation) by the 8th EC directive. The present paper gives a state of the art analysis of the empirical research results with regard to auditor and audit firm rotation. In contrast to the perception of the EC, the majority of the empirical results doesn’t find evidence for increasedfinancial accounting and audit quality by audit firm rotation. Furthermore, the positive effects of the internal rotation period of seven years and the cooling off period of two years by the 8th ECdirective are not empirically proved yet.
KW - Management studies
UR - https://www.mendeley.com/catalogue/4d494409-3d69-3514-9c75-3d10f11f75bf/
U2 - 10.22495/jgr_v1_i3_p1
DO - 10.22495/jgr_v1_i3_p1
M3 - Journal articles
VL - 1
SP - 7
EP - 13
JO - International Journal of Regulation and Governance
JF - International Journal of Regulation and Governance
SN - 0972-4907
IS - 3
ER -