Audit constitutes a solution of the issue of information asymmetry between the leaders and the shareholders or between the leaders and the other third contracting parties. As a mechanism of governance, it has for main role to reduce transaction and agency costs and to reassure the shareholders and third party contractors concerning the reliability of the financial information communicated.
Nevertheless, the quality of audit is not uniform and especially not directly apparent. The audit process is very complex and hardly orbservable by third parties and the audit report (the result of an audit) is so standardised in its content and format that it offers a only few possibilities for differentiation. Audit failures are often only known when there are published by press (Wooten, 2003). So,it is difficult to know the number of audit failures not published by the press.
In this context, the majority of researchers in the subject (notably DeAngelo, 1981; Nichols and Smith, 1983; Eichenseher et al., 1989 and Lennox, 1999) admit that audit quality evaluation is based on two fundamental concepts: auditor competence and independence. In these studies researchers have tried to comprehend audit quality through auditor’s quality. Because of the difficulties in observing the audit process, the majority of prescriptive and experimental studies concentrate on the research of substitutes for audit quality using an indirect evaluation approach. These substitutes being perceived by the market as related to the intrinsic characteristics of these two concepts (Venkataraman, R and al; 2008; Laurence, J and al, 2007; Chee-Yeow and Hun-Tong, 2008; Taylor 2005; Krishnan and Schauer, 2000; Reckers et al., 1997; Kaplan, 1995).
Several researchers have highlighted that this rather “indirect” evaluation approach to audit quality assumes conceptual and empirical limits which limits its credibility. The first is essentially related to risks of adverse selection and managerial complacency (Fama et Jensen, 1983a; Craswell, 1988 and Citron et Taffer, 1992). The second is connected more to the characteristics of the indicators identified (very simplistic and reductive indicators for the complexity of audit quality) and their inability to determine what must be done to improve audit quality (Sutton, 1993).
Recent financial scandals (especially the Enron affair) and the collapse of the accountancy firm Arthur Andersen, have confirmed the inadequacy of this indirect evaluation approach in comprehending audit quality. In Tunisia, we assisted in 2002 with the equivalent to the Enron case. It involved the collapse of the Batam company . This company caused a crisis of confidence on the Tunisian financial market by affecting the reliability of financial information and audit quality. These scandals have shattered the concept and measurement of audit quality which until then was based on exogenous indicators to the audit process. These reports of the ineffectiveness of standard evaluation approaches to audit quality have driven both the professional and academic world to rethink the current rules and mechanisms for audit quality evaluation and to debate the problem of its measurability.
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