Abstract:

It is possible that the decisions made are appropriate and consistent with the purpose of the decision, without a doubt, with reliable information used in the decision-making phase. In order to increase the accuracy and reliability of financial statements, which are an important element for the effective functioning of capital markets, independent audit services are needed. In this framework, the study aims to analyze whether the characteristics of the independent audit company affect the quality of the financial statements presented by the company. In accordance with this objective, 608 companies/year data of companies located in Borsa Istanbul and operating in the manufacturing sector between 2017-2020 years have been tested with a regression analysis. In this study, which supports the limited number of work done in the example of Turkey from a different perspective, the AWCA (Abnormal Working Capital Accruals) model developed by DeFond and Park (2001) which represents the quality of financial reporting was preferred. The study examined the relationship between the state of being a major member of the independent audit company, the annual audit income and the number of institutions concerned with the public interest it controls and the quality of the financial reports submitted. The findings of the study indicate that there is a statistically meaningful relationship between the state of the independent audit company and the quality of financial statements.

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