Environmental Reporting and Financial Audit
Author:
Univ. Assistant Ionel-Alin IENCIU, Ph. D.
JEL:
M 42, M 49
DOI:
Keywords:
financial audit, BIG FOUR, environmental reporting, entities, Bucharest Stock Exchange
Abstract:
Because environmental reporting remains voluntary at international level, there are differences in quality and quantity of environmental information reported by entities. In this study, the author analyzed the correlation between the reporting of environmental information and the type of auditor. This paper is an empirical analysis of how the type of auditor may explain the reporting of environmental information. The sample consists of 64 entities listed on the Bucharest Stock Exchange, first, second and third categories in 10 sectors of activity with a potential impact on the environment. The author conclude that internationally recognized auditors, wanting to keep their reputation, have a strong incentive upon the entities imposing stricter standards and more accurate reporting. Thus, the entities listed on the Bucharest Stock Exchange, audited by audit firms which are part of the Big Four, have a higher level of environmental reporting.\r\n