JEL Classification System
H83, M42, M48, C25
Abstract
The audit is performed to give assurance to the public that financial statements are fairly presented. Accurate issuances of audit opinions show how compliant firms are to auditing standards. Receiving an unfavorable audit opinion will signal firms to improve internal control. Given this, it is important for the top management to assess the factors that can lead to misrepresentation of financial statements and result in adverse opinions. The same principle can be applied to government units and offices. With this in mind, the study was performed to investigate the influences of qualitative and quantitative factors on audit opinions received by the local government units, specifically in the Metro Luzon Urban Beltway. Data on citywide audit opinions were gathered from the Commission on Audit’s (COA) website from 2007 to 2017. The paper employed a qualitative response regression model (QRM) through the ordered logit model, to allow the researchers to analyze the presence or absence of influence for every characteristic observed. The results suggest that audit quality is improved through auditor rotation. It further suggests that gender and urbanicity influence the audit opinion received.
Recommended Citation
Tugas, Florenz C.; Gomez, Maria Corazon P.; Sacorum, Roselle Marie A.; Lipana, Rica Angela M.; and Barawid, Geneva Leecea M.
(2020)
"An Analysis of Factors That Affect Audit Opinions: The Case of the Local Government Units in the Metro Luzon Urban Beltway,"
DLSU Business & Economics Review: Vol. 30:
No.
1, Article 7.
DOI: https://doi.org/10.59588/2243-786X.1119
Available at:
https://animorepository.dlsu.edu.ph/ber/vol30/iss1/7
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