Non-audit services and auditor independence: Norwegian evidence

We examine the effect on auditor independence of auditors providing non-audit services in the Norwegian audit market. We report the results of three tests of independence of mind and one test of independence in appearance. These tests find that there is a positive relationship between audit fees and...

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Autores principales:	Yu (Elli) Zhang, David Hay, Claus Holm
Formato:	article
Lenguaje:	EN
Publicado:	Taylor & Francis Group 2016
Materias:	auditing non-audit fees auditor independence audit opinion audit tenure norway Business HF5001-6182 Management. Industrial management HD28-70
Acceso en línea:	https://doaj.org/article/c8ae30900b2b465baea75d1d2792bcc6
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id	oai:doaj.org-article:c8ae30900b2b465baea75d1d2792bcc6
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spelling	oai:doaj.org-article:c8ae30900b2b465baea75d1d2792bcc62021-12-02T14:07:31ZNon-audit services and auditor independence: Norwegian evidence2331-197510.1080/23311975.2016.1215223https://doaj.org/article/c8ae30900b2b465baea75d1d2792bcc62016-12-01T00:00:00Zhttp://dx.doi.org/10.1080/23311975.2016.1215223https://doaj.org/toc/2331-1975We examine the effect on auditor independence of auditors providing non-audit services in the Norwegian audit market. We report the results of three tests of independence of mind and one test of independence in appearance. These tests find that there is a positive relationship between audit fees and non-audit fees, which does not suggest loss of independence. Further analysis using two-stage least squares shows that audit and non-audit fees are jointly determined, and the results are still not consistent with loss of independence. There is no relationship between the provision of non-audit services and the frequency with which auditors issue modified audit opinions. There is no association between non-audit services and audit tenure. Finally, we examine the relationship between unexpected or excess non-audit fees and cost of capital. There is no relationship. Our findings fail to find any evidence for loss of independence of mind or loss of independence of appearance as a result of providing non-audit services.Yu (Elli) ZhangDavid HayClaus HolmTaylor & Francis Grouparticleauditingnon-audit feesauditor independenceaudit opinionaudit tenurenorwayBusinessHF5001-6182Management. Industrial managementHD28-70ENCogent Business & Management, Vol 3, Iss 1 (2016)
institution	DOAJ
collection	DOAJ
language	EN
topic	auditing non-audit fees auditor independence audit opinion audit tenure norway Business HF5001-6182 Management. Industrial management HD28-70
spellingShingle	auditing non-audit fees auditor independence audit opinion audit tenure norway Business HF5001-6182 Management. Industrial management HD28-70 Yu (Elli) Zhang David Hay Claus Holm Non-audit services and auditor independence: Norwegian evidence
description	We examine the effect on auditor independence of auditors providing non-audit services in the Norwegian audit market. We report the results of three tests of independence of mind and one test of independence in appearance. These tests find that there is a positive relationship between audit fees and non-audit fees, which does not suggest loss of independence. Further analysis using two-stage least squares shows that audit and non-audit fees are jointly determined, and the results are still not consistent with loss of independence. There is no relationship between the provision of non-audit services and the frequency with which auditors issue modified audit opinions. There is no association between non-audit services and audit tenure. Finally, we examine the relationship between unexpected or excess non-audit fees and cost of capital. There is no relationship. Our findings fail to find any evidence for loss of independence of mind or loss of independence of appearance as a result of providing non-audit services.
format	article
author	Yu (Elli) Zhang David Hay Claus Holm
author_facet	Yu (Elli) Zhang David Hay Claus Holm
author_sort	Yu (Elli) Zhang
title	Non-audit services and auditor independence: Norwegian evidence
title_short	Non-audit services and auditor independence: Norwegian evidence
title_full	Non-audit services and auditor independence: Norwegian evidence
title_fullStr	Non-audit services and auditor independence: Norwegian evidence
title_full_unstemmed	Non-audit services and auditor independence: Norwegian evidence
title_sort	non-audit services and auditor independence: norwegian evidence
publisher	Taylor & Francis Group
publishDate	2016
url	https://doaj.org/article/c8ae30900b2b465baea75d1d2792bcc6
work_keys_str_mv	AT yuellizhang nonauditservicesandauditorindependencenorwegianevidence AT davidhay nonauditservicesandauditorindependencenorwegianevidence AT clausholm nonauditservicesandauditorindependencenorwegianevidence
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Non-audit services and auditor independence: Norwegian evidence

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