Auditor Independent Essay

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RELATIONSHIP BETWEEN AUDITOR INDEPENDENT, NON AUDIT FEES AND POLITICAL CONNECTION: GOING CONCERN OPINION

CHAPTER ONE
1.0 INTRODUCTION
This paper adds to the literature of auditor independent to examine the role of non-audit services and political connection in going concern opinion. Explicitly, it is constructed to explain the relationship between non-audit fees, political connection and auditor independent during political tsunami which serves as the basic issues also motivation for this paper. The problems statements are listed in align with research gap of prior studies and other factors contributing to the issues. Accordingly, several insights on the importance of this research such as research objectives, contribution of studies, literature …show more content…

For this purpose, the political crisis in 2008 Malaysia General Election is selected as the theme of study. The concern of going-concern opinion issued by independent auditors which rooted in some threats of political volatility duplicated with economic insecurity, thus undermine the impartiality of quality audit. Explicitly, I would like to study how the incentives of firm’s management, regulators and accounting institutions and auditors are induced by institutional structure where the firms are operating during “political tsunami” in Malaysia 2008 General Election. This political tsunami offer a unique theme to study the interaction of and impacts of institutional forces on accounting and auditing aspects. The ruling coalition undergo loss of supermajority political landscape in election result thus trigger series of long term uncertainties and impacts to numerous aspects in domestic especially politically connected firms suffered the most. From it, some inducements of concerned parties would like to modify nature of accounting reporting are anticipated so as the auditor’s opinion will be rendered. I expect the overall findings will shed some lights suggest that the non-audit services provided to firms with political connection may jeopardize auditor …show more content…

Yet, there is limited of studies have done in the investigation concerning the impact of non-audit services fee and political connection tremor on auditor independent during general election in developing economy similar to Malaysia.
Therefore, this study is expected will add to the stream of literature in numerous ways. First, this study is taken into consideration the particular variable which is unique to the audit circumstance in Malaysia context explicitly political connections. General election is perceived as one of the remarkable political risks particularly to politically connected firms. In general, various nations have dissimilar structure in resources administrative and allocation and consequently, the magnitude of general election’s effect on the institutional structure may diverge between one and another. Given the longest ruling Malaysia government under parliamentary system, it furnishes a deeper insight to evaluate the impact of Malaysia political connection impact to

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