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IFRS adoption and auditing: a review

Author

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  • Hichem Khlif
  • Imen Achek

Abstract

Purpose - The purpose of this paper is to review the empirical research literature dealing with International Financial Reporting Standards (IFRS) and auditing. The authors identify four main topics related to the effect of IFRS adoption on audit fees, audit market and audit report lag and the influence of auditor choice on IFRS compliance. Design/methodology/approach - For each reviewed stream of research, the authors present its theoretical underpinning and summarize its main results. Findings - Based on 26 empirical studies, the review reveals four main findings. First, IFRS adoption is associated with increased audit fees. Second, IFRS adoption has had an effect on audit market through auditor choice, audit switching and audit market concentration. Third, IFRS adoption has increased audit report lag. Finally, the authors document that audit quality, as proxied by auditor type, may play an important role in enforcing the compliance with IFRS. Practical implications - For regulators the review highlights that IFRS adoption is associated with several effects dealing with audit cost (audit fees), audit efficiency (audit report lag) and may benefit audit firms with international affiliation compared to local ones and this may inform regulators in settings that plan to adopt IFRS in the future. Originality/value - This literature review represents a historical record and an introduction for researchers who aim to investigate this topic in the future since the authors provide specific guidance for future research avenues for these reviewed strands of research and other unexplored topics related to auditing and IFRS.

Suggested Citation

  • Hichem Khlif & Imen Achek, 2016. "IFRS adoption and auditing: a review," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 24(3), pages 338-361, September.
  • Handle: RePEc:eme:arapps:v:24:y:2016:i:3:p:338-361
    DOI: 10.1108/ARA-12-2014-0126
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    Citations

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    Cited by:

    1. Gatluak Gach Chuol Thony & Anthony Duku Peter, 2023. "The Impact of Adoption of International Financial Reporting Standard on Quality of Accounting Information in South Sudan: A Case Study of Kenya Commercial Bank and Cooperative Bank," International Journal of Science and Business, IJSAB International, vol. 19(1), pages 28-48.
    2. Riaz, Zahid & Ray, Pradeep & Ray, Sangeeta, 2022. "The impact of digitalisation on corporate governance in Australia," Journal of Business Research, Elsevier, vol. 152(C), pages 410-424.
    3. Oleh Pasko & Mykola Hordiyenko & Fuli Chen & Yarmila Tkal & Yulia Abraham, 2021. "Mapping Global Research on International Financial Reporting Standards: A Scientometric Review," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 12(3), pages 116-134, May.
    4. Esraa Esam Alharasis & Hossam Haddad & Maha Shehadeh & Ahmad Saleem Tarawneh, 2022. "Abnormal Monitoring Costs Charged for Auditing Fair Value Model: Evidence from Jordanian Finance Industry," Sustainability, MDPI, vol. 14(6), pages 1-21, March.
    5. Esraa Esam Alharasis & Maria Prokofieva & Rateb Mohammad Alqatamin & Colin Clark, 2020. "Fair Value Accounting and Implications for the Auditing Profession: Historical Overview," Accounting and Finance Research, Sciedu Press, vol. 9(3), pages 1-31, August.
    6. Rajat Deb & Mukesh Nepal & Sourav Chakraborty, 2023. "IFRS and Audit Quality: A Systematic Literature Review," Management and Labour Studies, XLRI Jamshedpur, School of Business Management & Human Resources, vol. 48(1), pages 118-138, February.
    7. Khadijah Adeola Idowu & Jamiu Olakunle Tijani, 2020. "Audit Reporting Lag and Regulatory Compliance in Listed Financial Services Firms in Nigeria: A Cross-Sectoral Evaluation," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 6(3), pages 163-173, September.

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