IDEAS home Printed from https://ideas.repec.org/a/eme/jfcpps/jfc-12-2020-0257.html
   My bibliography  Save this article

Political connections, political corruption and auditing: a literature review

Author

Listed:
  • Imen Khelil
  • Hichem Khlif
  • Ines Amara

Abstract

Purpose - Given the interest in better understanding the economic effects of political connections and political corruption on auditor behavior, this paper aims to review empirical studies in the accounting and finance domain dealing with these topics. Design/methodology/approach - Keywords used to search for relevant studies include “political connections or political corruption” with “audit fees, audit report lag, audit independence and audit opinion.” This paper consults several editorial sources including Elsevier, Electronic Journals Service Elton B. Stephens Company, Emerald, Springer, Palgrave Macmillan, Sage, Taylor and Francis and Wiley-Blackwell. The search yields 16 published studies since 2006. Findings - The review reveals that the majority of studies dealing with the economic effect of political connections are conducted in an Asian setting. Political connections increase the likelihood of receiving a favorable audit opinion and they are associated with higher audit fees longer audit delays. However, they can compromise auditor independence. Studies dealing with the economic consequences of political corruption on auditing are mostly based in the US setting. The findings of the reviewed studies suggest that political corruption is associated with higher audit fees, longer audit delays and increases the likelihood of receiving a going concern audit opinion. Practical implications - The synthesis suggests that political connections can adversely (compromise auditor independence) or beneficially (reduce the likelihood of issuing a going concern audit opinion) impact auditor behavior depending on the legal, institutional and cultural characteristics prevailing in a particular setting. Political corruptions increase audit assessed risks leading to a higher probability of issuing a going concern audit opinion and increased audit effort (audit fees and audit delays). It should be noted here that the literature linked to political corruption and auditor behavior is still in its infancy and much remains to be learnt if this stream of research is examined outside the US setting. Originality/value - The review discusses the political connections and political corruption literature specifically devoted to auditor behavior. It identifies some limitations of this literature and offers guidance for future research avenues.

Suggested Citation

  • Imen Khelil & Hichem Khlif & Ines Amara, 2021. "Political connections, political corruption and auditing: a literature review," Journal of Financial Crime, Emerald Group Publishing Limited, vol. 29(1), pages 159-170, June.
  • Handle: RePEc:eme:jfcpps:jfc-12-2020-0257
    DOI: 10.1108/JFC-12-2020-0257
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/JFC-12-2020-0257/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://www.emerald.com/insight/content/doi/10.1108/JFC-12-2020-0257/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://libkey.io/10.1108/JFC-12-2020-0257?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Muhammad Aiman Asyraf Hanafi & Norzarina Md Yatim & Abdullah Sallehhuddin Abdullah Salim, 2023. "Conceptual Framework on Antecedents of True and Fair View Reporting Surrounding Migration to Accrual-Based Accounting by Public Sector Entities: A Case of Federal Statutory Bodies (FSB) in Malaysia," Information Management and Business Review, AMH International, vol. 15(4), pages 12-26.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:jfcpps:jfc-12-2020-0257. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.