Professionalism vs Commercialism: The Association between Non-Audit Services (Nas) and Audit Independence

Posted: 19 May 2002

See all articles by Divesh Sharma

Divesh Sharma

Kennesaw State University, School of Accountancy

Jagdish Sidhu

Nanyang Technological University (NTU) - Centre for Research in Financial Services (CREFS)

Abstract

The implications of the provision of NAS to audit clients on audit independence have attracted considerable regulatory and research attention. This study contributes to this topical issue by investigating the association between NAS and audit independence using actual fee data and a more appropriate context that enable a proper ex post assesment of the correctness of the auditor's opinion decision. The results are consistent with the notion that auditors exhibit low propensity to issue a going-concern qualification to clients generating higher proportions of NAS fees to total fees and raise independence implications regarding the joint provision of audit and NAS.

Keywords: auditing, audit independence, audit opinion, fees, non-audit services

JEL Classification: M49

Suggested Citation

Sharma, Divesh Shankar and Sidhu, Jagdish, Professionalism vs Commercialism: The Association between Non-Audit Services (Nas) and Audit Independence. Available at SSRN: https://ssrn.com/abstract=299470

Divesh Shankar Sharma (Contact Author)

Kennesaw State University, School of Accountancy ( email )

Kennesaw, GA 30144
United States

Jagdish Sidhu

Nanyang Technological University (NTU) - Centre for Research in Financial Services (CREFS)

Nanyang Avenue
Singapore, 639798
Singapore

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