Bribery and perceived auditor independence
Résumé
This research attempts to narrow down the knowledge gap in literatureconcerning bribery and its impact on auditor independence through
studying the gifts and benefits that given to auditor by his client.
Quantitative and qualitative methods in the form of questionnaire and
interviews are employed to examine the stakeholders’ perceptions namely
auditors, tax officers, bank loan officers, financial directors, and academics
toward auditor independence in the Yemeni environment. The questionnaire
and interview results indicate that the higher the value of gift or benefit, the
more threats there will be to auditor independence. These results appear
because gifts and benefits given to auditor create a close relationship
between the auditor and his client and influence the auditor’s conduct. The
interviewees agreed with the statement that any gift or benefit given to the
auditor in particular would undermine his independence. However, any gift
or benefit given to the public does not affect auditor’s independence, such
as advertising materials (pens, diary). This study is significant to lawmakers
and bodies of audit profession as it sheds an insight into the bribery and its
impact on the perceptions regarding auditor independence.
Keywords:Auditor independence, Bribery, Corruption, Yemen.
Jel Classification Codes: M42, D73
Références
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Journal of Economic Literature, 35(3), 1320-1346.
Carmichael, D., & Swieringa, R. (1968). The compatibility of auditing
independence and management services: An identification of issues.
The Accounting Review, 43(4), 697-705.
Central Bank of Yemen (2012).The number of the banks operating in the
Republic of Yemen. Retrieved from Administration of the
Superintendent of Banks Archive.
Central Statistical Organization. (2011). Annual Statistics Book.Retrieved
March 7, 2020, fromhttp://www.csoyemen.org/content.php?lng=arabic&cid=131
Conover, K. (2010). Bribery in Classical Athens. PhD Thesis, Princeton
university.
Creswell, J. W., & Clark, V. L. P. (2007). Designing and conducting
mixed methods research. Wiley Online Library.
Houghton, K. & Jubb, C. (2003). The market for financial report audits:
regulation of and competition for auditor independence. Law & Policy,
25(3), 299-321.
Jick, T. D. (1979). Mixing qualitative and quantitative methods:
Triangulation in action. Administrative science quarterly, 24(4), 602-
611.
Kershaw, D. (2006). Waiting for Enron: The unstable equilibrium of
auditor independence regulation. Journal of law and society, 33(3),
388-420.
KPMG. (2011). Global Anti-Bribery and Corruption Survey.Retrieved
from http://www.kpmg .com/ UK/ en/ Issues
AndInsights/ArticlesPublications/Documents/PDF/Advisory/23816NS
S_Global_ABC_Survey.PDF
Larmour, P., & Wolanin, N. (2001). Corruption and Anti-corruption.
Asia Pacific Press
Law, P. (2010). The influence of the types of NAS provisions and gifts
hospitality on auditor independence. International Journal of
Accounting and Information Management, 18(2), 105- 117.
Lee, S. H., Oh, K., & Eden, L. (2010). Why do firms bribe? insights from
residual control theory into firms’ exposure and vulnerability to
corruption. Management international review, 50(6), 775-796.
Ministry of Trade and Industry. (2011). Listed companies. Retrieved from
general department of statistics archive.
Ministry of Trade and Industry. (2012). Renews licenses of Yemeni
auditors.Retrieved July 29, 2012, from
http://www.moit.gov.ye/moit/ar/node/1693
Moghram, M. A. (0225). Political culture of corruption and state of
corruption in Yemen. Faculty of Law & Shariah, Sana'a University.
Retrieved from http://youthdo.org/en/images/yemen/10.pdf
Pany, K., & Reckers, P. M. J. (1980). The effect of gifts, discounts, and
client size on perceived auditor independence. Accounting Review,
55(1), 50-61.
Plaats, E. V. D. (2000). Regulating auditor independence. European
Accounting Review, 9(4), 625-638.
Ristei, M. (2010). Competing Formal and Informal Institutions in a
Democratizing Setting: An Institutional Analysis of Corruption in
Romania. PhD Thesis, Western Michigan University, Michigan.
Roberts, E. S. (1999). In defence of the survey method: An illustration
from a study of user information satisfaction. Accounting & Finance,
39(1), 53-77.
Sekaran, U., & Bougie, R. (2009). Research Methods for Business (5th ed.).
John Wiley and Sons.
Smith, J. M. (1972) Interviewing in Social and Market Research.
Routledge and Kegan Paul LTD.
Tax Authority of Yemen. (2010). Statistical data of the workforce in tax
offices. Retrieved from general department of planning and statistics
archive
Transparency International. (2011). Corruption Perceptions Index
(CPI).Retrieved August 16, 2020, fromhttp://cpi.transparency .org
/cpi2011/results/
Transparency International. (2013). Corruption Perceptions Index
(CPI).Retrieved January, 2014,
fromhttp://www.transparency.org/country#YEM
Wu, X. (2005). Corporate governance and corruption: A cross-country
analysis. Governance: An International Journal of Policy,
Administration, and Institutions, 18(2), 151-170.
Wyk, J. V., Dahmer, W., & Custy, M. C. (2004). Risk management and
the business environment in South Africa. Long Range Planning,
37(3), 259-276.
Yemeni’s Anti-Corruption Law. (No. 39, 2006). Retrieved August 16, 2020,
fromhttps://publicofficialsfinancialdisclosure.worldbank.org/sites/fdl/f
iles/assets/law-libraryfiles/Yemen_Anticorruption%20Law_2006_en.pdf
Zikmund, W. G. (2003). Business Research Methods (7th ed.). SouthWestern Cengage Learning
Journal of Economic Literature, 35(3), 1320-1346.
Carmichael, D., & Swieringa, R. (1968). The compatibility of auditing
independence and management services: An identification of issues.
The Accounting Review, 43(4), 697-705.
Central Bank of Yemen (2012).The number of the banks operating in the
Republic of Yemen. Retrieved from Administration of the
Superintendent of Banks Archive.
Central Statistical Organization. (2011). Annual Statistics Book.Retrieved
March 7, 2020, fromhttp://www.csoyemen.org/content.php?lng=arabic&cid=131
Conover, K. (2010). Bribery in Classical Athens. PhD Thesis, Princeton
university.
Creswell, J. W., & Clark, V. L. P. (2007). Designing and conducting
mixed methods research. Wiley Online Library.
Houghton, K. & Jubb, C. (2003). The market for financial report audits:
regulation of and competition for auditor independence. Law & Policy,
25(3), 299-321.
Jick, T. D. (1979). Mixing qualitative and quantitative methods:
Triangulation in action. Administrative science quarterly, 24(4), 602-
611.
Kershaw, D. (2006). Waiting for Enron: The unstable equilibrium of
auditor independence regulation. Journal of law and society, 33(3),
388-420.
KPMG. (2011). Global Anti-Bribery and Corruption Survey.Retrieved
from http://www.kpmg .com/ UK/ en/ Issues
AndInsights/ArticlesPublications/Documents/PDF/Advisory/23816NS
S_Global_ABC_Survey.PDF
Larmour, P., & Wolanin, N. (2001). Corruption and Anti-corruption.
Asia Pacific Press
Law, P. (2010). The influence of the types of NAS provisions and gifts
hospitality on auditor independence. International Journal of
Accounting and Information Management, 18(2), 105- 117.
Lee, S. H., Oh, K., & Eden, L. (2010). Why do firms bribe? insights from
residual control theory into firms’ exposure and vulnerability to
corruption. Management international review, 50(6), 775-796.
Ministry of Trade and Industry. (2011). Listed companies. Retrieved from
general department of statistics archive.
Ministry of Trade and Industry. (2012). Renews licenses of Yemeni
auditors.Retrieved July 29, 2012, from
http://www.moit.gov.ye/moit/ar/node/1693
Moghram, M. A. (0225). Political culture of corruption and state of
corruption in Yemen. Faculty of Law & Shariah, Sana'a University.
Retrieved from http://youthdo.org/en/images/yemen/10.pdf
Pany, K., & Reckers, P. M. J. (1980). The effect of gifts, discounts, and
client size on perceived auditor independence. Accounting Review,
55(1), 50-61.
Plaats, E. V. D. (2000). Regulating auditor independence. European
Accounting Review, 9(4), 625-638.
Ristei, M. (2010). Competing Formal and Informal Institutions in a
Democratizing Setting: An Institutional Analysis of Corruption in
Romania. PhD Thesis, Western Michigan University, Michigan.
Roberts, E. S. (1999). In defence of the survey method: An illustration
from a study of user information satisfaction. Accounting & Finance,
39(1), 53-77.
Sekaran, U., & Bougie, R. (2009). Research Methods for Business (5th ed.).
John Wiley and Sons.
Smith, J. M. (1972) Interviewing in Social and Market Research.
Routledge and Kegan Paul LTD.
Tax Authority of Yemen. (2010). Statistical data of the workforce in tax
offices. Retrieved from general department of planning and statistics
archive
Transparency International. (2011). Corruption Perceptions Index
(CPI).Retrieved August 16, 2020, fromhttp://cpi.transparency .org
/cpi2011/results/
Transparency International. (2013). Corruption Perceptions Index
(CPI).Retrieved January, 2014,
fromhttp://www.transparency.org/country#YEM
Wu, X. (2005). Corporate governance and corruption: A cross-country
analysis. Governance: An International Journal of Policy,
Administration, and Institutions, 18(2), 151-170.
Wyk, J. V., Dahmer, W., & Custy, M. C. (2004). Risk management and
the business environment in South Africa. Long Range Planning,
37(3), 259-276.
Yemeni’s Anti-Corruption Law. (No. 39, 2006). Retrieved August 16, 2020,
fromhttps://publicofficialsfinancialdisclosure.worldbank.org/sites/fdl/f
iles/assets/law-libraryfiles/Yemen_Anticorruption%20Law_2006_en.pdf
Zikmund, W. G. (2003). Business Research Methods (7th ed.). SouthWestern Cengage Learning
