Loan loss provisions in large publicly quoted European banks and auditor independence

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dc.contributor.author Campa, Domenico
dc.contributor.author Donnelly, Ray
dc.date.accessioned 2019-08-14T11:02:57Z
dc.date.available 2019-08-14T11:02:57Z
dc.date.issued 2019-07-18
dc.identifier.citation Campa, D. and Donnelly, R. (2019) 'Loan loss provisions in large publicly quoted European banks and auditor independence', International Journal of Auditing, 23(2), pp. 245-262. doi: 10.1111/ijau.12158 en
dc.identifier.volume 23 en
dc.identifier.issued 2 en
dc.identifier.startpage 245 en
dc.identifier.endpage 262 en
dc.identifier.issn 1090-6738
dc.identifier.uri http://hdl.handle.net/10468/8318
dc.identifier.doi 10.1111/ijau.12158 en
dc.description.abstract The European Commission, citing deficiencies in the financial statements of banks during the financial crisis, has questioned the independence of the auditors of European banks at the onset of the crisis. We test for evidence of impaired auditor independence by examining if the economic bond between auditors and clients is associated with the audit quality of banks, controlling for the strength of banking regulation of the country in which a bank operates. We find no evidence of income‐increasing loan loss provisions being positively associated with the auditor–client economic bond. There is no indication that auditor independence is impaired in EU banks. Stronger country regulation is associated with more conservative provisioning before and after the formation of the European Banking Authority. We also find that the strength of banking regulation mitigates any tendency of auditors' independence to be compromised by the auditor–client economic bond. en
dc.format.mimetype application/pdf en
dc.language.iso en en
dc.publisher John Wiley & Sons, Inc. en
dc.relation.uri https://onlinelibrary.wiley.com/doi/abs/10.1111/ijau.12158
dc.rights © 2019, John Wiley & Sons Ltd. This is the peer reviewed version of the following article: Campa, D. and Donnelly, R. (2019) 'Loan loss provisions in large publicly quoted European banks and auditor independence', International Journal of Auditing, 23(2), pp. 245-262. doi: 10.1111/ijau.12158, which has been published in final form at https://doi.org/10.1111/ijau.12158. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions. en
dc.subject Auditor independence en
dc.subject Banking regulation en
dc.subject European banks en
dc.subject Loan loss provisions en
dc.title Loan loss provisions in large publicly quoted European banks and auditor independence en
dc.type Article (peer-reviewed) en
dc.internal.authorcontactother Raymond Donnelly, Accounting & Finance, University College Cork, Cork, Ireland. +353-21-490-3000 Email: rdonnelly@afis.ucc.ie en
dc.internal.availability Full text available en
dc.check.info Access to this article is restricted until 24 months after publication by request of the publisher. en
dc.check.date 2021-07-18
dc.date.updated 2019-08-14T10:48:45Z
dc.description.version Accepted Version en
dc.internal.rssid 496591678
dc.contributor.funder Institute of Certified Public Accountants in Ireland en
dc.description.status Peer reviewed en
dc.identifier.journaltitle International Journal of Auditing en
dc.internal.copyrightchecked Yes
dc.internal.licenseacceptance Yes en
dc.internal.IRISemailaddress rdonnelly@afis.ucc.ie en
dc.identifier.eissn 1099-1123


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