An Experimental Study of Hong Kong and Chinese Auditors' Perceptions of Auditor Independence

Ramesh Narasimhan, Stephanie S.h. ng

Research output: Contribution to journalReview article

1 Citation (Scopus)

Abstract

The objective of this study is to compare the perceptions of Chinese and Hong Kong auditors towards auditor independence. There is growing concern about auditors' independence in the Peoples Republic of China (PRC) as a result of the rapidly changing business environment. These include the fast economic growth, changes in the accounting and auditing requirements including increases in demand for auditing services, competition and the status of accounting profession in the PRC. The purpose of this study is to investigate whether these changes affect the perceptions of auditor independence. The factors used in this study include the size of audit fee, provision of management advisory services, tenure of services provided and the relationship between the client and the auditor. The data were analyzed using analysis of variance (ANOVA). The overall hypothesis of a difference in the perceptions of Hong Kong and Chinese auditors was found to be significant. The results provide some indications of the stage of development of the accounting profession in China and the directions in harmonizing with international practices. Though there are some limitations of this study, it provides information for limited research in the accounting profession in China and highlights several areas for future study.

Original languageEnglish
Pages (from-to)1-18
Number of pages18
JournalAsian Review of Accounting
Volume7
Issue number2
DOIs
StatePublished - 1 Feb 1999

Fingerprint

Hong Kong
Auditors
Experimental study
China
Auditor independence
Accounting profession
Auditing
Tenure
Business environment
Analysis of variance
Factors
Audit fees
Economic growth
Service management
Stages of development

Cite this

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abstract = "The objective of this study is to compare the perceptions of Chinese and Hong Kong auditors towards auditor independence. There is growing concern about auditors' independence in the Peoples Republic of China (PRC) as a result of the rapidly changing business environment. These include the fast economic growth, changes in the accounting and auditing requirements including increases in demand for auditing services, competition and the status of accounting profession in the PRC. The purpose of this study is to investigate whether these changes affect the perceptions of auditor independence. The factors used in this study include the size of audit fee, provision of management advisory services, tenure of services provided and the relationship between the client and the auditor. The data were analyzed using analysis of variance (ANOVA). The overall hypothesis of a difference in the perceptions of Hong Kong and Chinese auditors was found to be significant. The results provide some indications of the stage of development of the accounting profession in China and the directions in harmonizing with international practices. Though there are some limitations of this study, it provides information for limited research in the accounting profession in China and highlights several areas for future study.",
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An Experimental Study of Hong Kong and Chinese Auditors' Perceptions of Auditor Independence. / Narasimhan, Ramesh; ng, Stephanie S.h.

In: Asian Review of Accounting, Vol. 7, No. 2, 01.02.1999, p. 1-18.

Research output: Contribution to journalReview article

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