An Agency Perspective of Auditor Change in Small Firms

Kevin Keasey and Robert Watson
Additional contact information
Kevin Keasey: Leeds University
Robert Watson: University of Manchester Institute of Science & Technology

Journal of Entrepreneurial Finance, 1991, vol. 1, issue 1, 45-59

Abstract: This paper uses an agency theory perspective to develop an understanding of the determinants of auditor change for small firms in the United Kingdom. The paper, therefore, extends the existing literature (see Williams [22] and Francis and Wilson [9]) from a consideration of auditor change for large firms in the United States to small firms in the U.K. The results indicate that small U.K. firms have a greater propensity to change their auditors subsequent to the receipt of a first-time audit qualification, to a change in the composition of their board of directors, to a change in their use of external loan capital, and when their existing loans are not secured. The results indicate some support for the agency arguments examined, though there is also evidence of auditor ‘accommodation’ being sought.

Keywords: Auditor; Small Firm; Auditor Change; Agency (search for similar items in EconPapers)
JEL-codes: G32 L25 M41 (search for similar items in EconPapers)
Date: 1991
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://jefsite.org/RePEc/pep/journl/jef-1991-01-1-e-keasey.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pep:journl:v:1:y:1991:i:1:p:45-59

Access Statistics for this article

More articles in Journal of Entrepreneurial Finance from Pepperdine University, Graziadio School of Business and Management Contact information at EDIRC.
Bibliographic data for series maintained by Craig Everett ().