Determinants of Voluntary Audit Adoption in Finnish Micro-Companies
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Journal Title
Journal ISSN
Volume Title
School of Business |
Master's thesis
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Author
Date
2018
Department
Major/Subject
Mcode
Degree programme
Accounting
Language
en
Pages
86+7
Series
Abstract
This study examines drivers for voluntary audit adoption among Finnish micro-companies. More precisely, it is tested if customer demand and perceived tax benefits drive voluntary audit adoption. Furthermore, the study investigates whether plans on international expansion or intentions to sell the company in the future have a positive association with voluntary audit demand. The study is motivated by the proposal of Ministry of Economic Affairs and Employment to extend the audit exemption to cover all micro-companies. The data are gathered via an e-mail survey that was sent to micro-companies that are currently mandated to purchase an audit but would become exempted should the proposed increase in audit thresholds be effectuated. The empirical testing is conducted with a modified version of the model used by Niemi et al. (2012). The results show that customer demand for audit and perceived tax-related benefits arising from audit drive voluntary audit adoption. However, no evidence is found to support the hypothesized positive association between voluntarily opting for audit and plans on international expansion. Similarly, no association between voluntary audit adoption and intentions to sell the company in the future are found either.Description
Thesis advisor
Ojala, HannuKeywords
financial auditing, audit exemption, micro-companies, audit regulation