The Effect of Auditing Quality Characteristics on Accounting Conservatism: The Case of Egypt
| العنوان بلغة أخرى: |
تأثير خصائص جودة المراجعة على التحفظ المحاسبي: دراسة مطبقة على بيئة الأعمال المصرية |
|---|---|
| المصدر: | مجلة كلية التجارة للبحوث العلمية |
| الناشر: | جامعة الإسكندرية - كلية التجارة |
| المؤلف الرئيسي: | Youssef, Amr (Author) |
| مؤلفين آخرين: | Abdel Hamid, Yasmine (Co-Author) |
| المجلد/العدد: | مج54, ع2 |
| محكمة: | نعم |
| الدولة: |
مصر |
| التاريخ الميلادي: |
2017
|
| الشهر: | يوليو |
| الصفحات: | 1 - 39 |
| DOI: |
10.21608/ACJ.2017.44674 |
| ISSN: |
1110-7588 |
| رقم MD: | 977426 |
| نوع المحتوى: | بحوث ومقالات |
| اللغة: | الإنجليزية |
| قواعد المعلومات: | EcoLink |
| مواضيع: | |
| كلمات المؤلف المفتاحية: |
Audit Quality Characteristics | Accounting Conservatism | Stock Listed Companies | Developing Countries | Empirical Study
|
| رابط المحتوى: |
الناشر لهذه المادة لم يسمح بإتاحتها. |
| المستخلص: |
Purpose Prior literature on accounting conservatism examines the effect of audit quality on conservatism show mixed results about this relationship, in this study, researchers extend previous studies by investigating the impact of the audit quality which is measured by audit firm size and auditor tenure on the enhancement of the level of accounting conservatism in the financial reports of the most active 50 nonfinancial companies listed in the Egyptian stock exchange across nine years of period from 2007 to 2015. Design/methodology/approach This study has used on nonprobability– purposive sample as it focuses on the most actively traded Egyptian non-financial companies listed in the Egyptian Stock Exchange, according to disclosure book - 50 most active companies, over the period 2007-2015. Rese-arch data used to measure accounting conservatism, audit quality and other variables collected mainly from Thomson Reuters Eikon database and disclosures books issued by the Egyptian Stock Ex-change Authority. Intensive analysis of the results obtained was conducted, starting with the descriptive analysis for the data, and followed by the correlation analysis of variables. After that testing the research hypotheses by utilizing the regression analysis to identify whether these hypotheses will be accepted or rejected. Findings After excluding outliers from the study data set, the regression analysis shows that audit firm size, firm leverage and firm profitability play a major role in affecting accounting conservatism in the Egyptian firms whereas audit firm size has a positive significant relation-ship with accounting conservatism which enhances the rule of big audit firms in the quality of financial reports, firm leverage has a positive significant relationship with accounting conservatism, and firm profitability has a negative significant relationship with accounting conservatism, while firm size and auditor tenure have a weak role whereas firm size has a positive insignificant relationship with accounting conservatism, and auditor tenure has a negative in-significant relationship with accounting conservatism. Based on these results, the study provided recommendations to the interested parties. Research limitations/ implications This study advances the literature as it examines this relationship for some selected companies in a developing country, Egypt, along with examining the impact of some moderating variables on this relationship. However, a more longitudinal and qualitative research is required to investigate whether the financial crisis and Arab Spring had any effect on this relationship especially that the period of study was between 2007 and 2015. In addition, the R square of the study model is only (.120), which means that only 12% variation in the de-pendent variable (accounting conservatism) is explained by the independent and moderating variables (Audit firm size, Auditor Tenure, Leverage, Firm Size and Profitability); therefore, this study misses some other variables that might affect accounting conservatism. A quantitative study should be conducted on a larger sample to generalize findings to all industry sectors. Practical implications The financial information reported by a firm is of great importance to the stakeholders as it directs their decisions. Stakeholders take several decisions including investing decisions by investors and institutions and providing loans decisions by banks and other lenders, and many other decisions are based on the information provided by firms. Therefore, in order to avoid the risk of losing the financial information credibility and the trust of the financial information users and in order not to face problems with the auditing firms, firms must have an accounting conservatism to provide credible and reliable information. Social implications Professional associations in Egypt and the government should work to improve the auditing quality in Egypt, as the characteristics of auditing quality have impacted the enhancement of the level of conservatism, through enhancing laws and regulations that enforce companies to adopt accounting conservatism principle in their financial system, also encourage audit firms to increase audit quality and focus on auditing companies accounting conservatism practices. This has a very high influence on the community and civil society, both now and in the future. Originality/value Limited research addressed the relationship between audit quality characteristics and Accounting conservatism in developing countries. Therefore, the importance of this study emerges from two main aspects; firstly, the literature review that provides a meaningful discussion of the audit quality and its effect on financial reporting quality. Secondly, an analysis of the existence of audit quality in different firms that is provided to show the consistency and divergence of the results across firms. أظهرت الدراسات السابقة التي تناولت العلاقة بين التحفظ المحاسبي وجودة المراجعة نتائج مختلطة حول طبيعة هذه العلاقة، ومن هنا يهدف هذا البحث لدراسة هذه العلاقة وذلك للوقوف على طبيعتها في بيئة الأعمال المصرية من خلال دراسة العلاقة بين حجم مكتب المراجعة ومعدل دوران مكتب المراجعة كمقاييس لجودة عملية المراجعة، ومستوى التحفظ المحاسبي في التقارير المالية، بالإضافة إلى تأثير مجموعة من العوامل الخاصة بالشركة محل المراجعة على مستوى التحفظ بها (حجم الشركة – نسبة الرافعة المالية – الربحية) وذلك على عينة من الشركات غير المالية المقيدة في البورصة المصرية خلال الفترة 2007- 2015. وقد تم تجميع بيانات الدراسة من قاعدة بيانات تومسون رويترز إيكون والافصاحات التي تصدرها هيئة البورصة المصرية، وقد تم الاعتماد على تحليل الانحدار في اختبار فروض الدراسة. وقد توصل البحث إلى أن حجم مكتب المراجعة يلعب دوراً رئيسياً في التأثير على مستوى التحفظ المحاسبي، حيث توجد علاقة إيجابية حجم مكتب المراجعة ونسبة الرافعة المالية ومستوى التحفظ المحاسبي، في حين توجد علاقة عكسية بين ربحية الشركة ومستوى التحفظ المحاسبي بها، ومن جهة أخرى لا توجد علاقة معنوية إحصائياً بين حجم الشركة ومعدل دوران مكتب المراجعة ومستوى التحفظ. |
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| ISSN: |
1110-7588 |
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