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The Financial Implications of Mandating Non-Financial Assurance

Author

Listed:
  • Stasi, Federer
  • Pierro, Roberto
  • Shaturaev, Jakhongir

Abstract

This paper examines the impact on audit effort of requiring the assurance of non-financial information. Specifically, we use a sample of large New Zealand not-for-profits (charities) newly required to report and have assured statements of service performance following accounting and auditing standards. We find an increase in audit fees of 14.5%, although there is no change in audit or filing lag. There is no difference based on auditing standard used, audit firm or whether an ‘other matter’ is expressed in the audit report. Overall, our results suggest that mandating the reporting and assurance of non-financial information should be viewed as having greater costs than adopting International Financial Reporting Standards.

Suggested Citation

  • Stasi, Federer & Pierro, Roberto & Shaturaev, Jakhongir, 2024. "The Financial Implications of Mandating Non-Financial Assurance," MPRA Paper 121883, University Library of Munich, Germany, revised 14 Jun 2024.
    • Handle: RePEc:pra:mprapa:121883
    as

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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Non-financial reporting; audit fees; assurance; IFRS; cost-benefit analysis;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • N6 - Economic History - - Manufacturing and Construction
    • R5 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis

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