Changes to the auditor’s report and the effects for the bank lenders in the Austrian financial market

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Ranninger, Barbara
Issue Date
MSc International Accounting and Finance
Dublin Business School
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The existing literature suggests that the audit has value for the users of financial statements but the usefulness of the auditor’s report itself should be increased. Because of criticism from different groups the current auditor’s report is subject to change. The IAASB issued an Invitation to Comment: Improving the Auditor’s Report. Those changes should provide the readers of the auditor’s report with more information, give clarifications to the audit and provide assurance to other information outside of the audited financial statements. This study will analyse the bank lenders’ perception of the current auditor’s report and the proposed changes to the auditor’s report and what changes bank lenders would like to see in the auditor’s report. To gather primary data a case study methodology was adapted. Four Austrian bank lenders were included in this research to answer those research objectives. The bank lenders included in the research had varied perceptions on whether the current auditor’s report influences the lending process or not. The research shows that the higher informative value of the proposed auditor’s report will increase the relevance of the auditor’s report for the lending process. The interviewees proposed a few minor changes but the proposed changes by the IAASB are already a step in the right direction. Author keywords: Auditing, banking