Title

The Demand for the UK Small Company Audit: An Agency Perspective

Publication Type

Journal Article

Publication Date

2001

Abstract

There has been considerable debate in recent years concerning the value of the small company audit. This paper aims to explore the impact of the introduction of deregulation of the small company audit in the United Kingdom in 1994. It seeks to identify why small companies may still demand voluntary audits in the absence of a statutory requirement. Theoretical and economic factors and rationales affecting small company management choice to engage auditing are examined. Following a survey sent to small companies qualifying for audit exemption, several hypotheses underlying the demand for audits in an unregulated environment are empirically tested in a logistic regression model. Some support is found for the agency, or stewardship, hypotheses in small company choice to engage auditing.

Discipline

Accounting | Business Law, Public Responsibility, and Ethics

Research Areas

Corporate Governance, Auditing and Risk Management

Publication

International Small Business Journal

Volume

2

Issue

2

First Page

61

Last Page

79

ISSN

0266-2426

Identifier

10.1177/0266242601192004

Publisher

Sage Journals