The development of auditor independence dimensions: Nigerian stakeholders’ perspective

Past studies on auditor independence (AI) generally focused on factors influencing AI by examining individual or group of factors posited to impact AI using various proxies of AI. Since regulatory frameworks define AI along two dimensions (fact and appearance), the use of proxies such as non-audit...

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Main Author:	Tahir, Fatima Alfa
Format:	Thesis
Language:	eng eng
Published:	2015
Subjects:	HF5601-5689 Accounting
Online Access:	https://etd.uum.edu.my/4899/1/s93668.pdf https://etd.uum.edu.my/4899/2/s93668_abstract.pdf
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id	my-uum-etd.4899
record_format	uketd_dc
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Zainol Ariffin, Zaimah Md Idris, Kamil
topic	HF5601-5689 Accounting
spellingShingle	HF5601-5689 Accounting Tahir, Fatima Alfa The development of auditor independence dimensions: Nigerian stakeholders’ perspective
description	Past studies on auditor independence (AI) generally focused on factors influencing AI by examining individual or group of factors posited to impact AI using various proxies of AI. Since regulatory frameworks define AI along two dimensions (fact and appearance), the use of proxies such as non-audit fees ratio, audit to total fees ratio or client importance is insufficient, because of their inability to capture both dimensions of AI. The study investigated the concept of AI and developed a measure for AI based on Nigerian stakeholders’ perceptions. The first phase investigated the constituents of AI and how they interdependently measure AI. Data was collected from 233 stakeholders comprising practising accountants, bank loan officers, members of the corporate governance body, Financial Reporting Council officers, officers of the Federal Inland Revenue Service and shareholders, using disproportionate stratified sampling. Results from exploratory and confirmatory factor analysis showed that the AI measure consisted of nine constructs (perceived objectivity, perceived integrity, perceived professional skepticism, self-interest threat avoidance, selfreview threat avoidance, familiarity threat avoidance, intimidation threat avoidance, advocacy threat avoidance and safeguards implementation). The second phase examined the applicability of the measure among financial directors of listed companies. Data collected from 62 financial directors of listed companies in Lagos was analyzed using Partial Least Squares Structural Equation Modelling. Results showed that the measure was valid, reliable and applicable in Nigeria. The study contributes to by proposing and operationalizing a holistic measure for AI. It also confirms the existence of a hierarchical model explaining AI in terms of its two dimensions. (Indpendence in fact and appearance) as measured by nine constructs. The study contributes theoretically, methodologically and practically to the body of knowledge and has implications to regulators, auditors and other researchers. It will benefit regulatory and professional bodies in assessing and structuring auditor independence standards, provides an assessment tool for auditors and an avenue for further research for academics.
format	Thesis
qualification_name	Ph.D.
qualification_level	Doctorate
author	Tahir, Fatima Alfa
author_facet	Tahir, Fatima Alfa
author_sort	Tahir, Fatima Alfa
title	The development of auditor independence dimensions: Nigerian stakeholders’ perspective
title_short	The development of auditor independence dimensions: Nigerian stakeholders’ perspective
title_full	The development of auditor independence dimensions: Nigerian stakeholders’ perspective
title_fullStr	The development of auditor independence dimensions: Nigerian stakeholders’ perspective
title_full_unstemmed	The development of auditor independence dimensions: Nigerian stakeholders’ perspective
title_sort	development of auditor independence dimensions: nigerian stakeholders’ perspective
granting_institution	Universiti Utara Malaysia
granting_department	Othman Yeop Abdullah Graduate School of Business
publishDate	2015
url	https://etd.uum.edu.my/4899/1/s93668.pdf https://etd.uum.edu.my/4899/2/s93668_abstract.pdf
_version_	1747827823899312128
spelling	my-uum-etd.48992021-03-29T09:55:49Z The development of auditor independence dimensions: Nigerian stakeholders’ perspective 2015 Tahir, Fatima Alfa Zainol Ariffin, Zaimah Md Idris, Kamil Othman Yeop Abdullah Graduate School of Business Othman Yeop Abdullah Graduate School of Business HF5601-5689 Accounting Past studies on auditor independence (AI) generally focused on factors influencing AI by examining individual or group of factors posited to impact AI using various proxies of AI. Since regulatory frameworks define AI along two dimensions (fact and appearance), the use of proxies such as non-audit fees ratio, audit to total fees ratio or client importance is insufficient, because of their inability to capture both dimensions of AI. The study investigated the concept of AI and developed a measure for AI based on Nigerian stakeholders’ perceptions. The first phase investigated the constituents of AI and how they interdependently measure AI. Data was collected from 233 stakeholders comprising practising accountants, bank loan officers, members of the corporate governance body, Financial Reporting Council officers, officers of the Federal Inland Revenue Service and shareholders, using disproportionate stratified sampling. Results from exploratory and confirmatory factor analysis showed that the AI measure consisted of nine constructs (perceived objectivity, perceived integrity, perceived professional skepticism, self-interest threat avoidance, selfreview threat avoidance, familiarity threat avoidance, intimidation threat avoidance, advocacy threat avoidance and safeguards implementation). The second phase examined the applicability of the measure among financial directors of listed companies. Data collected from 62 financial directors of listed companies in Lagos was analyzed using Partial Least Squares Structural Equation Modelling. Results showed that the measure was valid, reliable and applicable in Nigeria. The study contributes to by proposing and operationalizing a holistic measure for AI. It also confirms the existence of a hierarchical model explaining AI in terms of its two dimensions. (Indpendence in fact and appearance) as measured by nine constructs. The study contributes theoretically, methodologically and practically to the body of knowledge and has implications to regulators, auditors and other researchers. It will benefit regulatory and professional bodies in assessing and structuring auditor independence standards, provides an assessment tool for auditors and an avenue for further research for academics. 2015 Thesis https://etd.uum.edu.my/4899/ https://etd.uum.edu.my/4899/1/s93668.pdf text eng public https://etd.uum.edu.my/4899/2/s93668_abstract.pdf text eng public Ph.D. doctoral Universiti Utara Malaysia Abbott, L. J., Parker, S., Peters, G. F., & Raghunandan, K. (2003). An Empirical Investigation of Audit Fees, Nonaudit Fees, and Audit Committees. 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