Bakgrund Under 2010 avskaffade den svenska regeringen revisionsplikten för små aktiebolag. Motiven bakom beslutet var att små aktiebolag som valde att inte köpa in revisionstjänster skulle bli mer konkurrenskraftiga och minska sina administrativa kostnader, vilket skulle skapa förutsättningar för ökad tillväxt och lönsamhet. Tidigare forskning argumenterar för att revisionstjänster är en viktig resurs för små aktiebolags utveckling mot ökad tillväxt och lönsamhet. Redovisningskonsulttjänster likt revisionstjänster involverar kvalitetssäkring och rådgivning, vilket tyder på att även dessa tjänster kan bidra till små aktiebolags utveckling mot ökad tillväxt och lönsamhet. Syfte Syftet med den här studien är att förklara om revisions- och redovisningskonsulttjänster har ett positivt samband med tillväxt och lönsamhet. Metod Denna uppsats utgår från en kvantitativ forskningsmetod och en deduktiv ansats. Studiens hypoteser grundas i resursberoendeteorin, intressentteorin och agentteorin. En tvärsnittsdesign används då studien undersöker olika fall vid en viss tidpunkt. Studiens empiriska material hämtas från årsredovisningar genom databasen Business Retriever och genom en enkätundersökning. Slutsats Studien indikerar att det inte finns något positivt samband mellan revisions- och redovisningskonsulttjänster och tillväxt samt lönsamhet hos små aktiebolag. Därmed förkastas studiens hypoteser. Däremot indikerar studien att det finns ett negativt signifikant samband mellan lönsamhet och redovisningskonsulttjänster. Vidare indikerar studien att det skuldsättningsgraden, nettoomsättningen och ålder påverkar tillväxten och lönsamheten i små aktiebolag. / Introduction In 2010 the Swedish government abolished auditing obligations for small companies. The motivation behind the decision were that companies that chose not to purchase audit Services would reduce their administrative costs and thus become more competitive and they could reduce their administrative costs, which would create the conditions for increased growth and profitability. However, previous research argues that audit services are an important resource for the development of small companies towards increased growth and profitability. Accounting services from consultants as well as audit services involve quality assurance and advisory services, which indicates that these services contribute to the development of small companies towards increased growth and profitability. Purpose The purpose of this study is to explain whether audit and accounting consulting services have a positive relation with growth and profitability among small companies. Method This is a quantitative study based on a deductive approach. The hypotheses of the study relies essentially on resource dependence theory, interest theory and agent theory. A cross-sectional design is used since the study investigates different cases at a certain time point. The empirical data of the study is collected from annual reports from the Retriever Business database and a survey. Conclusion This study indicates that audit and accounting consulating services have no positive correlation with growth and profitability among small companies. As a result, we must reject the hypotheses. The study indicates a significant negative correlation between accounting consulting services and profitability. Furthermore, the study also indicates that the leverage, net sales and year have an impact on the growth and profitability in small companies.

The concept of organisational governance has been researched and debated by many. However, the concept of organisational governance maturity and what exactly this entails has received significantly less attention. It is beneficial for an organisation to understand how far they have progressed with implementing the various governance elements, as this will enable them to implement the most appropriate and necessary next steps, while taking corrective actions in becoming more mature in respect of organisational governance. This will furthermore aid the internal audit activity to provide more effective internal audit services, as knowledge of the level of organisational governance maturity enables them to more accurately determine which service they should deliver – either an assurance (organisation is mature) service or a consulting (organisation is not mature) service. The question now arises: how does an organisation, and the internal audit activity in particular, determine the level of organisational governance maturity without a benchmark of some sort that details the structures, systems and processes required to support governance at various levels of maturity? Published maturity frameworks/models can be used for this, however, there is very little that pertains specifically, comprehensively and holistically to organisational governance. This created the opportunity for the development of an organisational governance maturity framework. The main objective of this study is to develop a framework that can be used for assessing the level of organisational governance maturity within South African private sector organisations. Firstly, a comprehensive literature review was conducted where eight governance-related maturity models were used to produce a preliminary organisational governance maturity framework for the private sector in South Africa. Secondly, interviews were conducted with key governance stakeholders at the selected organisation to obtain input in the preliminary framework. The research findings, which resulted from the data analysed, were used as a means to refine the preliminary framework developed from the literature. No significant amendments were made to the preliminary framework and input obtained during the interviews supported the relevance and contribution of the framework developed from the literature. / Dissertation (MCom)--University of Pretoria, 2014 / gm2015 / Auditing / MCom / Unrestricted

In this study, I investigate the effect of auditor-provided tax services (ATS) on firms’ levels of book-tax differences and investors’ mispricing of book-tax differences. The joint provision of audit and tax services has been a controversial issue among regulators and academic researchers. Evidence on whether ATS improve or impair the overall accounting quality is inconclusive as a result of the specific testing circumstances involved in different studies. Book-tax differences capture managers’ earnings management and/or tax avoidance intended to maximize reported financial income and to minimize tax expense. Therefore, my first research question investigates whether ATS improve or impair audit quality by examining the relation between ATS and firms’ levels of book-tax differences. My results show that ATS are negatively related to book-tax differences, suggesting that ATS improve the overall audit quality and reduce aggressive financial and/or tax reporting. My second research question examines whether the improved earnings quality for firms acquiring ATS leads to reduced mispricing of book-tax differences among investors. Recent studies document that despite the rich information about firms’ future earnings contained in book-tax differences, investors process such information inefficiently, leading to systematic pricing errors among firms with large book-tax differences. My empirical evidence indicates that ATS mitigate such mispricing, with pricing errors being lower among firms acquiring ATS compared with firms without ATS. Collectively, these results support the notion that ATS improve audit quality through knowledge spillover. Moreover, the improved earnings quality among firms acquiring ATS in turn helps reduce investors’ mispricing of book-tax differences.

The purpose of this study is to examine the interactions and impact of six key corporate governance factors on greenhouse gas emissions in Swedish listed firms. Namely, board size, board gender diversity, CEO compensation, blockholder ownership, audit and non-audit fees. The study employs a quantitative research design and uses regression analysis to test the research hypotheses. The data for the study is obtained from a sample of 199 Swedish firms from 2014 to 2021 and data retrieved from the Nordic Compass Database, Swedish House of Finance Research Data Center. The findings reveal significant associations between corporate governance factors after controlling for firm size and industry with carbon emissions disclosure by firms. Concluding, these factors play a crucial role in tackling environmental sustainability performance in corporate practices.

<p>Auditing is common in many organizations and a legal requirement for all limited liability companies in Sweden (ABL 9:1). In directives from the government it is clearly stated that small firms will be exempted from the statutory audit requirement. In light of this forthcoming change in regulations, this thesis is used to analyze which factors are associated with a demand for auditing. Analysis in this thesis is based on a national survey including 900 Small and Medium-sized Enterprises (SMEs). Around 2/3 of respondent’s (CEO or CFO) state that the firm will choose to have audited accounts even in the absence of such a legal requirement. Based on responses from 421 firms, logistic regression results indicated that firms purchasing advisory services from an audit firm will choose to have their accounts audited to a higher extent than those firms not receiving advisory services. This finding, not identified in prior studies, is linked to advisory services being of higher quality when the audit firm also performs audit work. The demand for auditing is further positively associated with firm size, use of a Big 4 audit firm and firms located in the county of Småland. From these findings it follows that the traditional view of auditing as merely a control mechanism needs to be complemented by consideration of aspects of the internal value of auditing.</p><p>The approaches of SME’s when engaging an audit firm for different types of advisory services is examined in this study based upon survey data. It is shown that the majority of advisory services provided are related to core competencies of an auditor such as tax, accounting and law. Logistic regression results show a positive association between firms purchasing advisory services and the length of the relationship with the provider as well as with the respondent’s perception of the audit quality. The latter association further confirms the close connection between audit and advisory services. It should be noted that when an audit firm recommends advisory services their use is significantly higher. There is also support for the demand for advisory services being positively related to firms that are corporate subsidiaries and located in Småland and Norrland, but negatively associated with the respondent’s level of education. It follows that factors related to demand for advisory services on an aggregate level could be categorized as being dependent on firm characteristics, audit firm characteristics and the relationship between the parties.</p><p>Provision of non-audit services (NAS), such as different types of advisory services, to audit clients and the potential consequences for auditor independence and audit quality have been discussed in public debates and research as well as being subject of regulation. OLS regression results show that reporting quality is higher when the audit firm provides advisory services as well as preparing accounts. These findings hold for both discretionary accruals and a respondent’s perception of reporting quality. The provision of NAS improves the reporting quality due to better knowledge of the client and its operations. From the perspective of reporting quality this finding implies that there is no necessity to further restrict the possibility for an audit firm to provide advisory services as well as preparing accounts for audit clients.</p>

Different scandals around the globe during the past, in specific during the last decade, have intrigued the stakeholders to question the roles of both auditors and management. But most of the fingers since then have been raised on the role of auditors, because it is the auditors who are entrusted with the responsibility to detect any errors or frauds in the financial reports of the client-firm. Apart from this, the long-term auditor client relationship has been the center of attention in most of the discussions and debates as well. Numerous studies have been conducted by the academic researchers, financial and professional analysts, regulatory authorities and governing bodies, and in some cases by the auditors and the firms as well regarding the effects of long-term auditor-client relationship on audit quality, equity risk premium, financial reports quality, audit pricing etc. These studies provide us with different results, both with the positive and negative associations and effects of long-term auditor-client relationship on the basis of different factors and contexts. For long, auditing has been discussed in different studies and research areas but mostly in association with publicly listed companies. Less attention has been paid to the relationship of auditors and clients as far as clients in SMEs are concerned. In any country around the globe, SMEs are of major contribution in terms of backing the economy, giving it both the boost and the stability, as they collectively form the major chunk of the economy. If we specify our study to the SMEs in Sweden, then 99% of the enterprises in Sweden represent the SME sector; in addition they employ around 60% of the manpower. Based on these facts, and due to less attention given to auditor-client relationship in terms of SMEs, instead of; we have directed our concerns towards the study of effects of auditor-client relationship on audit quality in SMEs in this particular research study. In this study, we have opted for qualitative research with semi-structured interviews to be used as the tool for data collection. Interviews were conducted with two different groups of interviewees, one group representing the auditors and the other group representing the client-firms (SMEs). A total of seven interviews were conducted in order to strengthen and validate the results for our research question. Due to the limitations of this study, mostly in terms of cost and time, samples were selected from Umeå, Sweden. The data interview structure, data analysis and discussion, and conclusions were all made based on existing theories summarized in the theoretical review of this study. The results of this study suggests that (1) long-term audit tenure is beneficial for the audit quality if certain risk factors like risk of auditor independence and risk of developing complacency are controlled; and (2) factors such as NAS, industry specialization, knowledge and experience of the auditor, internal control in the client-firm, professional ethics, proper audit plan, providence of unbiased information by the client, and appointment of the auditor by the client-firm itself enhances the audit quality.

Auditing is common in many organizations and a legal requirement for all limited liability companies in Sweden (ABL 9:1). In directives from the government it is clearly stated that small firms will be exempted from the statutory audit requirement. In light of this forthcoming change in regulations, this thesis is used to analyze which factors are associated with a demand for auditing. Analysis in this thesis is based on a national survey including 900 Small and Medium-sized Enterprises (SMEs). Around 2/3 of respondent’s (CEO or CFO) state that the firm will choose to have audited accounts even in the absence of such a legal requirement. Based on responses from 421 firms, logistic regression results indicated that firms purchasing advisory services from an audit firm will choose to have their accounts audited to a higher extent than those firms not receiving advisory services. This finding, not identified in prior studies, is linked to advisory services being of higher quality when the audit firm also performs audit work. The demand for auditing is further positively associated with firm size, use of a Big 4 audit firm and firms located in the county of Småland. From these findings it follows that the traditional view of auditing as merely a control mechanism needs to be complemented by consideration of aspects of the internal value of auditing. The approaches of SME’s when engaging an audit firm for different types of advisory services is examined in this study based upon survey data. It is shown that the majority of advisory services provided are related to core competencies of an auditor such as tax, accounting and law. Logistic regression results show a positive association between firms purchasing advisory services and the length of the relationship with the provider as well as with the respondent’s perception of the audit quality. The latter association further confirms the close connection between audit and advisory services. It should be noted that when an audit firm recommends advisory services their use is significantly higher. There is also support for the demand for advisory services being positively related to firms that are corporate subsidiaries and located in Småland and Norrland, but negatively associated with the respondent’s level of education. It follows that factors related to demand for advisory services on an aggregate level could be categorized as being dependent on firm characteristics, audit firm characteristics and the relationship between the parties. Provision of non-audit services (NAS), such as different types of advisory services, to audit clients and the potential consequences for auditor independence and audit quality have been discussed in public debates and research as well as being subject of regulation. OLS regression results show that reporting quality is higher when the audit firm provides advisory services as well as preparing accounts. These findings hold for both discretionary accruals and a respondent’s perception of reporting quality. The provision of NAS improves the reporting quality due to better knowledge of the client and its operations. From the perspective of reporting quality this finding implies that there is no necessity to further restrict the possibility for an audit firm to provide advisory services as well as preparing accounts for audit clients.

EU:s revisionspaket begränsar kraftigt revisorernas möjlighet att tillhandahålla non-audit services (NAS) gentemot företag av allmänt intresse. Revisorer på små och medelstora revisionsbyråer påverkas dock inte av reglerna, varför det är intressant att studera hur dessa hanterar vilka tjänster man ska tillhandahålla och hur det påverkar revisorns roll.   Syftet med studien är att undersöka hur revisorn, på små och medelstora revisionsbyråer, hanterar olika rådgivningstjänster och det relaterade oberoendehotet i sin roll som konsult, som ett led i att försöka erhålla en förståelse för hur revisorn uppfattar växlingen mellan sin roll som revisor och den allt mer förestående konsultrollen. Studien baseras på kvalitativ forskning, för att försöka förstå och tolka revisorns upplevelser, varför intervjuer genomförts med sex kvalificerade revisorer.    Studiens huvudsakliga slutsatser är att revisorerna har svårt att definiera vilka tjänster som är revisionsnära och vilka som är av mer fristående karaktär. Revisorn måste tillhandahålla rådgivning för att upprätthålla revisionen, varför rådgivningstjänsterna kan betraktas som en integrerad del av revisorns tjänster. Revisorn tvingas i viss mån att växla mellan sin roll som revisor och konsult, till följd av att klienterna har höga förväntningar på rådgivning, medan revisionens övriga intressenter förväntar sig att klientföretagen kontrolleras genom en oberoende granskning. I slutändan anser respondenterna ändå sig vara revisorer även i utförandet av konsulttjänster. / The audit rules adopted by the EU strongly limit the auditors’ ability to provide non-audit services (NAS) to audit clients of public interest. Auditors in small and medium-sized audit firms are not affected by those rules. Therefore, it is interesting to study how they handle which services to provide and how it affects the auditor's role.   The purpose of the study is to investigate how auditors of small and medium-sized audit firms manage various advisory services and the related threat to independence in the role of consultant. Consequently, the study also seeks to gain an understanding of how the auditors perceive the issue of having to shift between the role as auditor and the increasingly imminent role as consultant. The study is based on qualitative research, in order to understand and interpret the auditor's experiences, which is why interviews were conducted with six auditors.   The main conclusions of the study are that the auditors have difficulty defining which services are audit-related and which are less audit-related. The auditor must provide advice to maintain the audit. Advisory services can therefore be regarded as an integral part of the auditor's services. The auditor is forced to shift between the roles of auditor and consultant, as a result of the clients’ high expectations for advisory services. This is in contradiction with the audit's other stakeholders’ expectations for the companies to be checked through an independent examination. However, the respondents still consider themselves to be auditors even in the performance of consulting services.

This thesis examines the factors affecting audit and non-audit fees and the effects of the joint provision of audit and non-audit services on auditing. The first essay focuses on environmental factors. Using data for Swedish listed companies over a six year span, including pre-crisis, crisis and post-crisis periods, the essay investigates whether changing economic conditions affect the level of fees paid for audit and non-audit services. The finding suggests that auditors increase their risk premium for auditing during a financial crisis andtend to charge higher audit fees as a response to lower risk levels in the post-crisis period. On the other hand, a significant reduction in non-audit fees suggests that companies are less willing to invest in consulting services during thecrisis and post-crisis periods. The second essay also studies the effects of environmental factors on audit pricing. Using data for financial institutions in 24 European countries, the study examines whether the level of effort spent on the evaluation of fair values is higher for more uncertain fair values.The result suggests that an increasing level of complexity and risk requires greater audit effort. Furthermore, the results showthat the strength of a country’s institutional setting is positively associated with the effort spent on the evaluation of high uncertainty fair value estimates. The finding implies that auditors spend more effort in stronger regulated countries, possibly due to higher potential litigation costs. The third essay focuses on the factors related to an individual audit partner. Based on the data of publicly listed Swedish companies, it investigates whether partner special competencies are reflected in the prices charged for auditing. The findings show that partner industry expertise and client-specific expertise are associated with higher audit fees. A further finding isthat female partners are considerably under-represented among specialists. However,the under-representation of females among higher qualified partners does not seem to negatively affect their possibilities to earn higher fees. The fourth essay investigates how the joint provision of audit and non-audit services affects perceived knowledge spillover and audit efficiency. The essay makesuse of survey data from a large sample of Swedish auditors and finds that the levels of communication and trust are positively associated with knowledge spillover. The result further suggests that the information gained from the provision of non-audit services can reduce auditors’ effort (time) spent on different audit procedures, thereby increasing audit efficiency.

Non-audit services provided by audit firms have been a popular scientific topic within the fields of audit and accounting research over the past decades. Numerous researchers have attempted to provide a theoretical contribution by examining different ways of measuring the concepts of audit quality and financial reporting quality. The resulting consequences are mixed results and a lack of consensus among researchers from both research fields. The two, in other situations, rather distinctive research fields of audit quality and financial reporting quality, have, in several cases, been confounded without analytical reflection regarding their differences. In parallel to the scientific progress, regulatory bodies have noticed the increasing trend of non-audit services and how they constitute larger portions of the audit firm’s annual revenues. Their responses have been legal restrictions, both in the US and Europe, in order to cease the trend. The purpose of this thesis is to make a pronounced investigation regarding the relationship between non-audit services and financial reporting quality in Swedish private firms. Furthermore, it will also be of interest to examine if this proposed relationship is moderated by the presence of the four global market-leading audit firms or not. The study is based on a deductive approach and a quantitative research strategy, to collect and analyze data from annual reports. To fulfill the purpose of the study, the data is analyzed by conducting binary and multinomial logistic regression tests. The results suggest that there is an association between certain types of non-audit services and financial reporting quality. Specifically, services that are unrelated to tax have proven to be statistically significant positively correlated with financial reporting quality. No evidence was found supporting a moderating effect by the characteristics of audit firms, suggesting that the choice of an audit firm is irrelevant for attaining high financial reporting quality when purchasing non-audit services. The study’s theoretical contribution is the novelty arising from the combination of studying non-audit services’ impact on financial reporting quality within a Swedish setting on private firms. The study also provides empirical contribution by using a proxy for financial reporting quality rarely used in previous research. The findings are of practical importance since they suggest that firms potentially benefit in their financial reporting by purchasing these kinds of services, which contradicts past actions made by regulatory bodies.