Title

Effect of outsourcing public sector audits on cost-efficiency

Document Type

Journal Article

Publisher

Wiley Interscience

Faculty

Business and Law

School

Accounting, Finance and Economics, Finance, Economics, Markets & Accounting Research

RAS ID

9294

Comments

This article was originally published as: 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. Original available here

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

Access Rights

open access

 

Link to publisher version (DOI)

10.1111/j.1467-629X.2009.00302.x