Auditor tenure and audit quality in Spanish state-owned foundations

  1. González Díaz, Belén 1
  2. García Fernández, Roberto 1
  3. López Díaz, Antonio 1
  1. 1 Universidad de Oviedo
    info

    Universidad de Oviedo

    Oviedo, España

    ROR https://ror.org/006gksa02

Journal:
Revista de contabilidad = Spanish accounting review: [RC-SAR]

ISSN: 1138-4891

Year of publication: 2015

Volume: 18

Issue: 2

Pages: 115-126

Type: Article

DOI: 10.1016/J.RCSAR.2014.04.001 DIALNET GOOGLE SCHOLAR lock_openDIGITUM editor

More publications in: Revista de contabilidad = Spanish accounting review: [RC-SAR]

Sustainable development goals

Abstract

This paper aims to analyze the impact of auditor tenure on audit quality. The research is motivated by the absence of consensus in published works, and by the scarcity of studies carried out on non-profit organizations. Using a sample of 254 audits carried out between 2003 and 2010 on Spanish state-owned foundations, we find that, although foundation audit quality decreases as tenure length increases, this quality loss does not become apparent until the sixth year of the foundation-auditor relationship, after an initial five years of improvement in quality. The empirical evidence is important for regulators and financial statement users, given that it suggests the need for the introduction of tenure-reducing measures which, at the same time, also ensure a minimum tenure period

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