The Role of Audit Firm and Partner Styles in Enhancing Financial Statement Comparability: Evidence from Egyptian Non-Financial Listed Companies

Document Type : Original Article

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Accounting Department Faculty of Commerce Damnhour University Alexandria Egypt

Abstract

This research aims to test the role of the audit Firm and partner styles in enhancing the financial statements comparability for non-financial companies listed in the Egyptian Exchange in the context of four control variables that express the operational characteristics, which are the differences in companies size, cash flows from operations, revenues, and leverage of companies during the period From 2015 to 2019. The fundamental analysis reveals that auditing financial statements by the same audit firm and/or partner style improves financial statements comparability, and the cash flows from operating as a control variable significantly affect the financial statements comparability. The results of the additional analysis indicated that the difference in operating cash flows increases the effect of the audit firm's style on the financial statements comparability, and that the difference in size and operating cash flows increases the effect of audit partner's style on the financial statements comparability, while the difference in leverage reduces this effect. Finally, the results of the sensitivity analysis showed that changing the measure of financial statements comparability did not affect the strength or direction of the two main relationships.

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