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Success in failure? Reflections on the changing Spanish audit environment

Author

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  • Maria Antonia Garcia Benau
  • Emiliano Ruiz Barbadillo
  • Christopher Humphrey
  • Walid Al Husaini

Abstract

The 1990s in Spain have witnessed a significant shift in attitudes towards the role of auditing, with promises of more transparent reporting being replaced by talk of audit expectations gaps. This paper explores the changing atmosphere, both through an analysis of one of the most notorious scandals of recent times - involving the Banco Espanol de Credito ('Banesto') - and a more general review of the way the Spanish profession has responded to such downturns in public expectations of auditing. While at first sight, the profession appears to have become more defensive and the audit environment more competitive, the multinational accounting firms do appear to have strengthened their position in the Spanish audit market. Intriguingly, despite public expressions of concern with the quality and capabilities of auditing and the imposition of large fines on audit firms for inadequate audit work, proposed 'solutions' for improving audit quality include the establishment of a self-regulated audit regime and reductions in auditor liability. The Spanish experience allows for some timely reflections on the significance of an audit expectations gap and highlights the importance of viewing the audit function from an international perspective.

Suggested Citation

  • Maria Antonia Garcia Benau & Emiliano Ruiz Barbadillo & Christopher Humphrey & Walid Al Husaini, 1999. "Success in failure? Reflections on the changing Spanish audit environment," European Accounting Review, Taylor & Francis Journals, vol. 8(4), pages 701-730.
    • Handle: RePEc:taf:euract:v:8:y:1999:i:4:p:701-730
    DOI: 10.1080/096381899335772
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    References listed on IDEAS

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    Cited by:

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    2. Jose Gonzalo & Anne Garvey, 2005. "In the aftermath of crisis: The post-Enron implications for Spanish university accounting educators," European Accounting Review, Taylor & Francis Journals, vol. 14(2), pages 429-439.
    3. Beatriz García Osma & Belén Gill de Albornoz Noguer & Elena De las Heras Cristobal, 2016. "Opinion shopping: Partner versus firm-level evidence," Working Papers. Serie EC 2016-02, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    4. García Blandón, Josep & Argilés Bosch, Josep Maria, 2013. "Audit firm tenure and qualified opinions: New evidence from Spain," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 16(2), pages 118-125.

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