Public Audit in Emerging Markets: The Role of External Audit in Financial Transparency- Longitudinal Evidence from Kosovo 2018-2022

Authors : Riza Spanca, Nermin Çıtak
Pages : 351-378
Doi:10.14783/maruoneri.1667503
View : 77 | Download : 107
Publication Date : 2025-07-27
Article Type : Research Paper
Abstract :External audits are fundamental to promoting financial transparency, accountability, and good governance—particularly in the public sector, where independent oversight can deter corruption and ensure responsible use of public funds (DeAngelo, 1981; Hay, Knechel, & Willekens, 2014). In emerging economies, however, the effectiveness of audits is often limited by weak enforcement, lack of institutional autonomy, and gaps in institutional capacity (Bracci et al., 2015; Heald, 2018). This study investigates the role of external audits in enhancing transparency in Kosovo’s public sector, drawing on secondary data from audit reports and regulatory assessments covering the period 2018–2022. Drawing on the Audit Quality Model (AQM) as a theoretical framework, this study examines how internal and external factors—such as auditor competence, independence, and regulatory enforcement—conceptually influence the implementation of audit recommendations and broader financial governance outcomes in Kosovo’s public sector (Knechel et al., 2012). The findings reveal that while audit quality is positively associated with transparency, persistent challenges—such as low implementation rates of audit recommendations, recurring financial mismanagement, and limited municipal oversight—continue to undermine the transformative potential of audits. By providing a longitudinal analysis of audit report trends and institutional responses, this study contributes to the literature on public sector auditing in transitional economies. It highlights the need for stronger enforcement mechanisms, improved institutional capacity, and increased accountability to ensure that audit processes meaningfully support financial transparency and governance reform in Kosovo
Keywords : Denetim Kalitesi, Dış Denetim, Mali Şeffaflık, Denetim Önerileri, Kamu Sektörü, Kosova, Gelişmekte Olan Ekonomiler, Denetim Yönetişimi

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