United States and European Union Auditor Independence Regulation: Implications for Regulators and Auditing Practice

ISBN-13: 9783835002876 / Angielski / Miękka / 2006 / 255 str.

Opis

In recent years, the Sarbanes-Oxley-Act has received intemational attention unlike few other laws. The rules presented in this act take influence on business practice and dominate the ongoing discussion on business constitution in the USA as well as in Europe. Christiane Strohm's dissertation investigates the effects of the Sarbanes- Oxley-Act and the revised 8 EU-Directive - as a response toward the US-law - on auditing. This study is innovative for several reasons. Combining an auditor independence risk model (Mock et. al. 2005) with considerations on task complexity (Bonner 1994, 1995), the author develops an experimental approach that can be put to future use in research on regulation. In the following, the American and European regulations are investigated in three separate experiments that are conducted with participants of international background. With this, the author provides - to my knowledge - the first empirical comparative analysis of the Sarbanes Oxley Act and the revised 8 EU- Directive. As both statutes provide representative examples for rules-based (Sarbanes-Oxley-Act) and for principles-oriented (8 EU-directive) regulation, this work deserves recognition from beyond the limited scientific community of those interested in auditing. The experimental design and the results generated by this study are of high significance for the general discussion on the advantages of either rules-based or principles-oriented regulation that characterizes the current controversial debate on corporate governance.

Spis treści

Auditor Independence Risk Prior Research on Auditor Independence Auditor Independence Regulation Task Complexity and Hypotheses Development Empirical Studies on Auditor Independence Regulation Consequences from the Empirical Findings for the European Capital Market

O autorze

Dr. Christiane Strohm promovierte bei Prof. Dr. Christoph Watrin am Institut für Unternehmensrechnung und -besteuerung der Universität Münster. Sie ist zur Zeit Visiting Scholar an der University of Southern California, Leventhal School of Accounting, Los Angeles.

Blurb

In recent years, the Sarbanes-Oxley-Act has received international attention unlike few other laws. The rules presented in this act take influence on business practice and dominate the ongoing discussion on business constitution in the USA as well as in Europe.

Christiane Strohm investigates the effects of the Sarbanes-Oxley-Act and the revised 8th EU-Directive on auditing. The results of her first experiment indicate that there is a difference in the communication and safeguarding effects of a regulation, depending on the precision of its wording. Findings of her second experiment show that safeguarding effects also depend on auditors' monetary incentives and on perceived costs of litigation. The author also tests the effectiveness of a transparency report which is proposed by the European Union. The most important safeguards (policies and procedures) are perceived to be quality assurance, internal quality controls and independence practice and compliance.