Accounting though Journal Ain-Shams University, Faculty of Commerce. Volume No.1, year 20, ISSN: 2356-8402. Show 36 Pages Posted: 9 Feb 2019 Last revised: 10 Jun 2019 Date Written: January 29, 2016 AbstractThe effect of the economic financial crisis worldwide has increased the need for auditors to provide a high quality services to their clients. An important element considered by clients for selecting their auditors is whether the audit firm has specialization in particular industry. Audit firm industry specialization provides clients with value for money services to help management achieve efficiency and effectiveness in their operations. Other benefits for audit firms may include increased market share, audit tenure, better financial reporting and less earnings management, audit quality with less restatements of financial information, appropriate audit fees, less exposure to litigation risk, less enforceable action by supervisory bodies and ability to compete in highly competitive environment. Specialization was also seen as critical for the survival of the auditing profession. This research analyzes the effects of audit firm industry specialization on the retention of the audit firm and growth in its business. Factors such as whether the firm is a big 4, with international affiliation, local firm, type of industry and growth were also studied for audit firm retention and growth. The sample studied includes the top 100 publicly held companies’ annual reports in the Egyptian stock market during the period 2007-2011 which are analyzed to determine the audit firms’ retention and growth. The results support that industry specialization has an important effect on the auditor’s retention especially for industry where capital investment is significant such as building, construction, financial services and housing and real estate. Big 4 audit firms retained their clients due to their industry specialization and brand name. The findings provided evidence that good knowledge of accounting & auditing standards resulted in audit firms with international affiliation competing with big 4 for clients’ retention & growth in business. The result also showed some evidence that the auditing profession in Egypt is dominated by the big 4 and the Central Audit Organization. Suggested Citation: Suggested Citation Eldeeb, Mohamed Samy and Hegazy, Mohamed A., The Impact of Auditor Industry Specialization on the Retention and Growth of Audit Clients (January 29, 2016). Accounting though Journal Ain-Shams University, Faculty of Commerce. Volume No.1, year 20, ISSN: 2356-8402., Available at SSRN: https://ssrn.com/abstract=3325528 BKC’s Specialized Industries team provides a full range of accounting, tax and business advisory services to companies and organizations and keeps them abreast of changes to accounting and tax laws affecting their industry sector. Many of our Specialized Industry clients also engage our team as consultants for industry-specific special projects: Golf courses for financial accounting, banking and reporting to members, Check Cashing stores for compliance with state banking regulations, Food Processors for capital assistance, cost segregation and tangible property regulation compliance, and Homeowner’s Associations for financial accounting and
reporting to homeowners. We have a significant client base for each of these specialties and are well versed in their unique challenges. Our overall objective is to help enhance our specialized industry clients’ growth and profitability through value-added, industry-specific advice. What sets BKC apart? Recommended textbook solutions
 Advanced Engineering Mathematics10th EditionErwin Kreyszig 4,134 solutions Chemical Reaction Engineering3rd EditionOctave Levenspiel 228 solutions Introduction to Chemical Engineering Thermodynamics7th EditionHendrick Van Ness, J.M. Smith, Michael Abbott 582 solutions
Chemistry for Engineering Students2nd EditionLawrence S. Brown, Thomas A. Holme 945 solutions What are specialized industries?What is a specialized industry? Perhaps it is easiest to start by explaining that a specialized industry is not necessarily rare or even unusual. Examples of specialized industries include: airline banking and insurance agriculture, and oil extraction.
What is specialized auditing?A special audit is a tightly-defined audit that only looks at a specific area of an organization's activities. This type of audit may be initiated by a government agency, but could be authorized by any entity, or even internally. Examples of special audits are noted below: Compensation audits. Compliance audits.
Why an audit important for an institution under specialized industry?The purpose of audit is to enhance the degree of confidence of intended users in the FS by issuing an opinion on whether the FS are prepared, in all material respects, in accordance with an applicable financial reporting framework.
What does auditing and assurance do?The audit is the process of evaluating the accounting entries present in the financial statement of the company. The audit checks the accuracy of the financial reports. Assurance is the process of analyzing and used in the assessment of accounting entries and financial records.
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