Effect of outsourcing public sector audits on cost-efficiency
Document Type
Journal Article
Publisher
Wiley Interscience
Faculty
Faculty of Business and Law
School
School of Accounting, Finance and Economics / Finance, Economics, Markets and Accounting Research Centre
RAS ID
9294
Abstract
This study compares the cost-efficiency of ‘in-house’ and outsourced to private sector audit supplier arrangements to deliver financial audits in the public sector by examining audit cost-efficiency within the context of the public sector arrangement at one state in Australia (Western Australia). The results for 178 public agencies show that outsourced audits are, in general, more costly than in-house audits, but this result is conditional on the type and size of public agency. Specifically, outsourced audits are more costly than in-house audits for small statutory authority audits, whereas for specialist audits (i.e. hospitals) and large and complex statutory authority audits, the in-house supply is equally efficient as the outsourced service.
DOI
10.1111/j.1467-629X.2009.00302.x
Comments
Chong, K. M., Dolley, C., Houghton, K., & Monroe, G. S. (2009). Effect of outsourcing public sector audits on cost‐efficiency. Accounting & Finance, 49(4), 675-695. Available here