The association between non-audit services and the propensity of going concern qualifications: Implications for audit independence
Year: 2001
Type: article
Abstract: This study1 examines the association between non-audit fees (NAS) fees as a proportion of total fees (PROPNAS) and auditors' propensity to issue a going concern qualification to clients facing imminent bankruptcy. Clients generating higher (lower) PROPNAS are expected to be less likely (more likely) to receive a going concern qualification in the year immediately preceding bankruptcy. The results of the study, using a small sample of 49 bankrupt Australian companies, are consistent with the hypothesised association between PROPNAS and the propensity of a going concern qualification. Implications of the results for auditor independence are discussed. © City University of Hong Kong.
Author: Divesh S. Sharma
Institutions: Nanyang Technological University, Kennesaw State University
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2009707246