Tag Archives: Auditor Switch

Determinants of Auditor Switching in Bahraini’s Listed Companies – An Empirical Study (Published)

The study aims to investigate the crucial factors (determinants) for auditor switch among listed companies in Bahrain Bourse. Cronbach’s alpha measurement was used to examine the uniformity and reliability level of the data. T-test and multiple logistic regression techniques were used in the analysis. The results of the descriptive statistics indicate that the most important section of determinants is Section C (Competition among PAF) with the highest Mean = 3.84 and standard deviation = 0.42, followed by Section D (Size of Public Auditing Firm (PAF)) with Mean = 3.83 and standard deviation = 0.35, followed by Section B (Audit Fees) with mean of 3.51 and standard deviation = 1.30. The T- test results indicated that there are significant mean differences between auditor switching of the factors “Financial conditions of the client” (P-value < 0.005), “Audit Fees” (P-value < 0.005), “Change in management” (P-value < 0.005), and “Qualified audit opinion” (P-value = 0.039). It also shows that there is a positive relationship between the factors “Change in management” H1, “financial conditions of the client”, “audit fees H6” and to a certain extent to “competition among PAF, H4 and auditor switch”. However, there was no significant relationship between the factor “size of public auditing firm H3 and auditor switching. Multiple logistic regression analysis is employed to measure the association between a single dependent variable (auditor switch) and multiple independent variables. The results show that financial condition of client, size of public audit firm and change in management have negative relationships with auditor switch. Audit fees, competition among PAF and qualified audit opinion respectively have positive relationships with auditor switch as predicted.

Keywords: : Bahrain Bourse, Audit Firms, Auditor Switch, Determinants Factors., Financial Condition, Level of Competition, Size of Audit Firms