Abstract:
This study aimed to test the impact of the mandatory transition to International Financial Reporting Standards on the audit profession in the business environment of Saudi Arabia - Audit Cost (Audit Fees), Audit Efficiency (Audit Report Lag)- and to analyze the implications on the choice of the type of auditor and the audit market.
To achieve these objectives the study relied on the analysis of the financial reports of Saudi registered companies, except the banking sector and financial services and insurance sector companies
during the period before the transition to International Financial Reporting Standards (2016) and the transition period to standards (2017) and the period after the transition to IFRS (2018). To develop 3 models to measure this effect: the first, to measure the impact of international financial reporting standards on the cost of the audit (Fees) (first hypothesis), and the second: to measure the impact on the timing of the issuance of the external audit report (the second hypothesis), Third to confirm the results of the second model
The study found a positive impact of international financial reporting standards on the cost of the audit (Fees), as well as having a positive impact of these standards on the timing of the issuance of the external audit report . The study also found an increase in the number of companies dealing with international firms which lead to control of the large audit firms on the audit market in Saudi Arabia.
Depending on the previous result the study recommended the need to
increase awareness of preparers and users of financial reports and the auditors of the importance of these standards. as well as the need to the audit market in Saudi Arabia is rated on Professional Standards to eliminate the monopoly of the profession after the mandatory transition to International Financial Reporting Standards in all economic sectors, |
