QUALITY CONTROL FOR AUDITING FIRMS IN TURKEY: A RESEARCH ON DIFFICULTIES ENCOUNTERED BY EXTERNAL AUDITORS IN COMPLIANCE WITH QUALITY CONTROL STANDARDS

Öz

The main purpose of this study is to examine the difficulties encountered by external auditors in compliance with Quality Control Standard. This research is evaluating the impact of audit quality factors on audit companies in Turkey according to Quality Control Standard. Moreover, this study analyzes auditors’ perception of audit quality in Turkey and determines the factors, which are influencing audit quality. It attempts to explore auditors’ opinions on difficulties that auditors’ experience and factors that influence audit quality. The research method of this study is to interview with auditors, who have experience on audit over 20 years and working at audit companies, which audited more than 95% of listed companies in 2015. Auditors have been chosen randomly. Interviews with auditors empirically examine Turkish auditors perceptions on the audit quality and their problems with application of standards. According to the findings of this research the factors influencing audit quality in Turkey have been identified and as a result, the aspects in regards to the audit quality in terms of legal regulations have been determined and suggestions have been provided.

Anahtar Kelimeler

• Auditing in Turkey
• Quality
• Audit Quality
• ISQC1

Kaynakça

1. Arens, A. A., R. J. Elder and M. S. Beasley. (2012). Auditing and Assurance Services: an Integrated Approach. Boston: Prentice Hall.
2. Asthana, S. and J. P. Boone. (2012). Abnormal Audit Fee and Audit Quality. Auditing: A Journal of Practice & Theory, Vol.31, No.3, pp. 1-22.
3. Barkess, L., & Simnett, R. (1994). The Provision of Other Services by Auditors: Independence and Pricing Issues. Accounting and Business Research, pp. 99-108.
4. Beattie, V., R. Brandt and S. Fearnley. (1999). Perceptions Of Auditor Independence: U.K. Evidence. Journal of International Accounting, Auditing and Taxation Vol. 8(1), pp.67-107.
5. Belkaoui, A. (1989). Behavioral Accounting. Westport, CT: Quorum Books.
6. Canning, M. and D. Gwilliam. (1999). Non-Audit Services and Auditor Independence: Some Evidence From Ireland. European Accounting Associate, Vol. 8(3), pp. 401-419.
7. Chi, W., L. Hughen, C. J. Lin and L. L. Lisic. (2013). Determinants of Audit Staff Turnover: Evidence from Taiwan. International Journal of Auditing. Vol. 17 pp.110-112.
8. Daugherty, B. E., D. Dickins, R. C. Hatfield and J. L. Higgs. (2012). An Examination of Partner Perceptions of Partner Rotation: Direct and Indirect Consequences to Audit Quality. Auditing: A Journal of Practice & Theory, Vol. 31, No. 1, pp. 97–114.

9. DeAngelo, L. (1981b). Auditor Size and Audit Quality. Journal of Accounting and Economics Vol. 3 (3). pp.183–199.
10. Deis, D. R., and G. A. Giroux. (1992). Determinant of Audit Quality in the Public Sector. Accounting Review, pp. 462-479.
11. Deming, W. E. (1998). Krizden Çıkış. İstanbul: Kalder, 2, Baskı.
12. Dopuch, N. and R. R. King. (1991). The Impact Of MA On Auditors’ Independence: An Experimental Market Study. Journal of Accounting Research 29 (Supplement): 60-98.
13. Grout, P., I. Jewitt, C. Pong and G. Whittington. (1994). Auditor Professional Judgment: Implications for Regulation and The Law. Economic Policy, Vol. 9(2), pp. 308-351.
14. International Organization for Standardization (ISO), 2013.
15. Kavut, L. (2002). Ulusal ve Uluslararası Bağımsız Denetim Firmalarında Çalışan Denetçilerin Bağımsız Denetim Hizmetlerinin Kalitesine İlişkin Tutumları. Yönetim Dergisi, Vol.41, pp.7-21.
16. Krishnan, G. and P. Schauer. (2001). Differences in Quality Among Audit Firms. Journal of Accountancy, 85.
17. Lavin, D. (1976). Perceptions of the Independence of the Auditor. The Accounting Review. Vol. 51: 1 pp.41-50
18. Lindsay, D. (1989). Financial tatement Users’ Perception Of Factors Affecting The Ability Of Auditors To Resist Client Pressure In A Conflict Situation. Accounting and Finance, pp.1-18.
19. Litt, B., D. S. Sharma, T. Simpson and P. N. Tanyi. (2014). Audit Partner Rotation and Financial Reporting Quality. Auditing: A Journal of Practice & Theory. Vol. 33, No. 3. pp. 59–86.
20. Lowe, D. J. and K. Pany. (1995). CPA Performance Of Consulting Engagements With Audit lients: Effects On Financial tatement Users’ Perceptions And Decisions. Auditing: A Journal Of Practice And Theory, Vol.14(2), pp. 35-53.
21. Myers, and Omer (2003). Exploring the term of the auditor-client relationship and the quality of earnings: a case for mandatory auditor rotation. The Accounting Review 78(3):759-778.
22. Neri, L., and A. Russo. (2014). A Framework For Audit Quality: Critical Analysis. Business and Management Review, Vol.3 (09), pp.25-30.
23. Nichols, K., and D. Smith. (1983). Auditor Credibility and Auditor Changes. Journal of Accounting Research, Vol. 21, pp. 534-544.
24. Pany, K. and P. M. J. Reckers. (1980). The Effects of Gifts, Discounts, and Client Size on Perceived Auditor Independence. The Accounting Review, Vol.55:1, pp.50-61.
25. Paulin, M., R. Ferguson and M. Payaud. (2000). Effectiveness Of Relational And Transactional Cultures In Commercial Banking: Putting Client Value Into The Competing Values Model. International Journal of Bank Marketing Vol.18 (7): pp.328–337.
26. Pham, H., P. Amaria, B. Thanh and S. Tran. (2014). A Study of Audit Quality in Vietnam. International Journal of Business, Accounting, and Finance, Vol. 8, Number 2, pp.73-110.
27. Piot, C. (2001). Agency Costs And Audit Quality: Evidence From France. The European Accounting Review, Vol. 10:3, pp. 461-499.
28. Simunic, D. A. (1980). The Pricing of Audit Services: Theory and Evidence. Journal of Accounting Research, Spring, Vol. 18, No. 1, pp. 161-190.
29. Titman, S. and B. Trueman. (1986). Information Quality And Valuation of New Issues. Journal of Accounting and Economics Vol. 8 pp.159–172.
30. Uçma, T., and M. Beycan. (2008). Development of Independent Auditing in State Banks In Turkey From Past to Future. Journal of Yasar University Vol.3 (12), p. 1711-1730.
31. Wooten, T.C. (2003). Research About Audit Quality. The CPA Journal, Vol. 73(1), pp. 48-51.
32. Wyer, J.C., G. T. White and E. C. Janson. (1988). Audits of Public Companies by Smaller CPA Firms: Clients, Reports and Quality. Auditing: A journal of Practice & Theory, pp. 164-173.