Bankers’ Perceptions of Factors Affecting Auditor Independence

This study examines the effects of audit committees, client financial condition, management advisory services, competition and audit firm size on New Zealand bankers′ perceptions of auditor independence. Results obtained by using an ANOVA repeated‐measures block design, indicate that audit firms providing MAS from a separate division in the audit firm and operating in a competitive environment are perceived as having a lower risk of losing independence. Small audit firms were perceived to be more at risk of losing independence than large audit firms. Audit committees and client financial condition did not affect perceptions of auditor independence.