Naslov
Auditors Selection and Companies' Characteristics - Case of Croatian Capital Market

Autori
Aljinović Barać, Željana ; Šodan Slavko ; Vuko, Tina

Vrsta, podvrsta i kategorija rada
Radovi u zbornicima skupova, cjeloviti rad (in extenso), znanstveni

Izvornik
CONFERENCE PROCEEDINGS, Volume 1, The 5th International Scientific Conference: Enterpreneurship and Macroeconomic Management: Reflections on the World in Turmoil / Afrić Rakitovac, Kristina ; Šugar, Violeta ; Bevanda, Vanja - Pula : Fakultet ekonomije i turizma Dr. Mijo Mirković Sveučilišta Jurja Dobrile u Puli, 2011, 2-22

ISBN
978-953-7498-41-2

Skup
The 5th International Scientific Conference: Enterpreneurship and Macroeconomic Management: Reflections on the World in Turmoil

Mjesto i datum
Pula, Hrvatska, 24.03.2011. - 26.03.2011

Vrsta sudjelovanja
Predavanje

Vrsta recenzije
Međunarodna recenzija

Ključne riječi
Companies’ characteristics; financial performance; auditor selection; audit firm type

Sažetak
The audit opinion together with financial statements represent crucial piece of information for financial statement users, especially for the capital markets participants. Since audit market in Croatia is highly competitive, companies have great possibility of auditor choice. Thereby, the aim of this paper is to empirically investigate association between auditor selection and companies’ characteristics on the sample of Croatian listed companies. Our research is based on assumption that companies with different financial and business characteristics demand different type of audit firms. In order to test stated hypotheses multinomial logistic regression is applied. The degree of association between the auditor choice and companies’ performance characteristics is measured by following financial ratios: 1) absolute value of total accruals, 2) return on equity (ROE), 3) financial leverage (debt ratio), 4) cash flow ratio and 5) BEX index as overall business excellence measure. Moreover, ownership structure and size of the company as control variables are included. Dependent variable audit firm is categorized into three groups in accordance with their reputation and size: 1) the Big Four audit firms (i.e. PriceWaterhouseCoopers, ErnstandYoung, Deloitte and KPMG) ; 2) midsize audit firms and 3) small audit firms employing only one or two certified auditors. Data necessary for the research are extracted from annual financial statements for the period from 2003 to 2008, available on HANFA database. Results of the research indicate that debt ratio, size and ownership have statistically significant influence in auditor selection.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

POVEZANOST RADA