Authors: Georgios Petropoulos, Maria Tsipouridou, Spathis Charalampos, Georgia Boskou

Title: Disclosure of Important Issues in Audit Reports: First Year of Implementation

Abstract

The aim of this study is to explore the new audit regulation regarding Key Audit Matters (hereinafter referred to as KAMs) in the first year of implementation in Greece, in 2017. Initially, the research questions raised are as follows: 1) How many KAMs are disclosed and what type of KAMs occur most frequently, 2) Which KAMs are most frequently recorded per industry 3) What types of KAMs are most frequently presented per audit firm (Big-4, Crowe-sol SA, Grant Thornton, and others). To answer these questions, we study and hand-collect data from 153 audit reports of companies listed on the Athens Stock Exchange (ASE). Moreover, an empirical analysis is carried out to examine whether the size of the firm being audited and the size of the audit firm  affect the number of KAMs.. Οur empirical analysis shows that the number of KAMs is positively related with the size of the audited company, the length of time (in years) during which, the audit firm controls the company and the financial leverage ratio. In addition, the number of KAMs is negatively affected by whether the audit firm is SOL. S.A

Key words: Key Audit Matters, International Auditing Standard 700, International Auditing Standard 701

JEL Classification: M41, M42, G38