The Effect of Auditor Rotation on the Relationship between Financial Manipulation and Auditor’s Opinion

Abstract Background: Since external auditors possess the expertise necessary for detecting manipulations in financial statements, they should also take into account earnings management that could lead to it. In context, auditor’s independence, which can be affected by rotation, is of utmost importance. Objectives: This paper aims examine moderating effect auditor rotation on relationship between extent manipulation and type opinion companies listed Zagreb Stock Exchange Republic Croatia. Methods/Approach: A panel analysis with logistic regression conducted test research hypothesis. The sample consists 210 observations during three years from 2015 2017. Results: Results show a significant positive current year opinion. Furthermore, there negative, but statistically insignificant opinion, as well frequency over five Conclusions: It not likely when generating their proven an adequate stimulus context.