A Qualitative Analysis of Auditor Independence in Dominica: The Views of Auditors and Corporate Accountants

Abstract

This study seeks to investigate the perceptions of auditor independence in Dominica focusing primarily on the views of the auditors and corporate accountants. A qualitative study was employed using 25 auditors and corporate accountants. Interviews were conducted using a semi-structured interview schedule adapted from the Sucher and MacLullich (2004) study in Czech Republic. The study concluded that auditors in Dominica are perceived to be highly independent. It was found that the corporate accountants were generally unaware of the accounting/auditing regulatory framework in Dominica. The small business economy/unsophisticated nature of businesses, long audit tenure, the absence of a regulatory body, the closeness of society and political influence were all perceived to impair auditor independence in Dominica. Contrary, auditor independence was perceived to be enhanced by the auditors’ personal ethical values, the recently established regulatory body and the moderate competitive market in Dominica. The findings attempted to fill the gap in literature on auditor independence in small developing countries. The findings revealed that there is no regulatory body for auditors in Dominica. It was also found that the competitiveness of the audit market and the small size of the society could threaten auditor independence. However, the provision of non-audit services was not perceived to threaten auditor independence. It was also perceived that the auditors in Dominica are guided by the society’s high ethical values, which are brought about by their cultural and religious beliefs. This implies that cultural and religious pressures play a significant role in shaping the perceptions of auditor independence in Dominica.