 Understanding the determinants of the magnitude of entity-level risk and account-level risk key audit matters: The case of the United KingdomLaura Sierra-García, Nicolás Gambetta, María A. García-Benau and Manuel Orta-Pérez The British Accounting Review, 2019, vol. 51, issue 3, 227-240 Abstract: This study was conducted to analyse the influence of auditor and client characteristics on the magnitude and type of key audit matters (KAM) disclosed in the audit reports of the FTSE 100 companies in the UK during the period 2013–2016. A recently introduced standard requires auditors to reveal the main risks faced by the client and to describe how these are addressed in the audit. Our results show that Deloitte, EY and KPMG tend to report fewer entity-level-risk KAM (ELRKAM) than PwC, while KPMG and BDO report fewer account-level-risk KAM (ALRKAM) than PwC. In general, auditors of companies that pay higher audit services fees present more ELRKAM and fewer ALRKAM. Our findings also show that client characteristics are relevant to the number and type of KAM included in the audit report. Our results show that auditor and client characteristics are determinants of the number of KAM disclosed and, moreover, determine the type of KAM disclosed in the audit reports. Keywords: Key audit matters; FTSE 100; ISA 700; ISA 701; Auditor characteristics; Client characteristics (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:bracre:v:51:y:2019:i:3:p:227-240 DOI: 10.1016/j.bar.2019.02.004 Access Statistics for this article The British Accounting Review is currently edited by Nathan Lael Joseph and Alan Lowe More articles in The British Accounting Review from Elsevier |
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