Abstract

Purpose: The purpose of the study is to analyze the first hand data regarding intimacies between government entities and government audit institution of Pakistan, to see its impact on the quality.
 Design/Methodology/Approach:
 Qualitative research design is used to explore the concept base on theoretical saturation technique.
 Findings: The results revealed by default presence of social ties among interactive agents. It further explores indirect relationship between audit quality and social interactions in the presence of petty corruption due to familiarity, unwarranted mutual trust and favoritism however this relationship is shifted toward direct relationship in the presence of material corruption due to fear of losing good reputation, loss of job, fear of departmental inquiry, threat of floating your weaknesses before your rival clique.
 Implications/Originality/Value: The results presented in this paper should therefore be of great interest to government, regulators and standard-setters charged with developing accounting standards to improve the audit quality of reporting information related to existing government auditing setup.

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