Cardiff University | Prifysgol Caerdydd ORCA
Online Research @ Cardiff 
WelshClear Cookie - decide language by browser settings

Auditor independence in Malaysia: the perceptions of loan officers and professional investors

Ahmad, Maslina Binti 2012. Auditor independence in Malaysia: the perceptions of loan officers and professional investors. PhD Thesis, Cardiff University.
Item availability restricted.

PDF (thesis) - Accepted Post-Print Version
Download (11MB) | Preview
[img] PDF - Supplemental Material
Restricted to Repository staff only

Download (175kB)


The current study examined several issues regarding auditor independence from the perspective of an emerging market such as Malaysia. A spate of ‘mini-Enrons’ in 2007 and 2008 has raised questions of investor confidence in the financial system specifically the national stock market. These scandals involving listed companies have highlighted concerns of regulators and other interested parties relating to threats to auditor independence. Factors affecting the ability of auditors to remain independent include long audit tenure, financial dependence on a single audit client, non-audit services provided to audit clients, ex-auditor employment with an audit client and the existence of audit committees. It is therefore timely to examine the importance of auditor independence in the provision of reliable and credible financial information. The current study uses a questionnaire survey to examine users’ (bank loan officers and professional investors) perceptions of the impact of the various factors on auditor independence. The results of the study revealed that Malaysian users of financial statements have serious concerns about the threats to auditor independence. The results also reveal that audit committees are perceived as the main safeguard for auditor independence. In general, both groups of respondents agreed that the current regulations for auditors, as set down by the Malaysian Institute of Accountants’ By-Laws, were sufficient to safeguard auditor independence. However, there are mechanisms that the financial statement users believed should be implemented that could provide greater protection for their investment. For example, the loan officers in this study seemed to prefer mandatory audit firm rotation to partner rotation. Further investigation indicated that differences existed in perceptions across the examined demographic and background variables. The results of the study also suggest that Malaysian loan officers and professional investors still have faith in the auditing profession and this is reflected in their belief that audited financial statements are important for them to make lending and investing decisions.

Item Type: Thesis (PhD)
Status: Unpublished
Schools: Business (Including Economics)
Subjects: H Social Sciences > HG Finance
Date of First Compliant Deposit: 30 March 2016
Last Modified: 19 Mar 2016 23:20

Actions (repository staff only)

Edit Item Edit Item


Downloads per month over past year

View more statistics