Does an Agency-Type of Audit Model Fit a Stewardship Context? Evidence from Performance Auditing in Dutch Municipalities

Forthcoming in Financial Accountability & Management

Posted: 28 Jun 2014

See all articles by Sandra Tillema

Sandra Tillema

University of Groningen - Faculty of Economics and Business

Henk J. ter Bogt

University of Groningen - Faculty of Economics and Business - Dept. of Accounting

Date Written: June 26, 2014

Abstract

The degree of auditor independence is an important issue in the performance auditing literature. However, little attention has been paid to the influence of the context in which an audit body operates. This paper investigates how an audit model with a high degree of auditor independence, which is consistent with agency theory’s rather formal view of relationships in organizations, functions in a context with more informal relationships, as implied by stewardship theory. Based on two case studies and a survey, the paper concludes that Dutch councilors are more satisfied with audit reports if in their municipality there is a fit between context and audit model.

Keywords: performance auditing, local government, independence, agency theory, stewardship theory

JEL Classification: M4

Suggested Citation

Tillema, Sandra and ter Bogt, Henk J., Does an Agency-Type of Audit Model Fit a Stewardship Context? Evidence from Performance Auditing in Dutch Municipalities (June 26, 2014). Forthcoming in Financial Accountability & Management, Available at SSRN: https://ssrn.com/abstract=2459523

Sandra Tillema (Contact Author)

University of Groningen - Faculty of Economics and Business ( email )

Postbus 72
9700 AB Groningen
Netherlands

Henk J. Ter Bogt

University of Groningen - Faculty of Economics and Business - Dept. of Accounting ( email )

P.O. Box 800
9700 AV Groningen
Netherlands
+31 50 363 7191 (Phone)

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