Concentration of the Audit Market: Evidence from Serbia

Open access


This paper presents a research on market concentration of audit services in the Republic of Serbia during the 2008-2011 period. Market concentration was measured by Herfindahl-Hirschman index (HHI) and concentration ratio CR4, based on four independent variables: operating revenue, net earnings, number of employees and number of audit clients. The research of market concentration based on operating revenue as the most referential variable indicated that the market for audit services in the Republic of Serbia has a moderate concentration and that it has the characteristics of an oligopoly of four largest audit firms known as “Big Four”. However, research of market concentration, when other variables are taken in consideration, does not reveal dominance of “Big Four” in terms of net earnings, number of employees and number of clients. The differences in conclusions when different variables are concerned can be explained by relatively high audit fees of “Big Four” and a lack of correlation between operating revenue and net earnings.

If the inline PDF is not rendering correctly, you can download the PDF file here.

  • Agencija za privredne registre. (2012). Registar finansijskih izveštaja i podataka o bonitetu pravnih lica i preduzetnika. preuzeto 20.08.2012. sa sajta:

  • Bigus J. Zimmermann R. C. (2008). Non-Audit Fees Market Leaders and Concentration on the German Audit Market International Journal of Auditing volume 12 str. 159-179.

  • Brezina I. Pekar J. Čičkova Z. (2012). The Analysis of Concentration of Slovak Banking Sector. Subotica: SM 2012 str. 1-8.

  • Cameran M. Di Vicenzo D. Merlotti E. (2005). The Audit Firm Rotation Rule: A Review of the Literature. Milan: SDA Bocconi

  • Dubaere C. (2008). Concentration on the Audti Market - master dissertation. Ghent: Ghent University

  • European Commission. (2004). Guidelines on the assessment of horizontal mergers. Official Journal of European Union.

  • Jakšić D. Mijić K. Andrić M. (2012). Analysis of Variations in the Performance of Audit Firms in the Republic of Serbia. Belgrade: Economic Annals No. 193 str. 71-91.

  • Komora ovlašćenih revizora. (2012). Registar preduzeća za reviziju. preuzeto 19.08.2012. sa sajta:

  • Le Vourc`h J. Morand P. (ECSP Europe). (2011). Study on the Effects of the Implementation of the Acquis on Statutory Audits of Annual and Consolidated Accounts Including the Consequences on the Audit Market. Paris: European Commission.

  • Li C. Song F. Wong S. (2005). Audit Firm Size Effects in China`s Emerging Audit Market - working paper. Hong Kong: Institute of Economics and Business Strategy.

  • Ministarstvo finansija. (2012). Registar preduzeća za reviziju. preuzeto 19.08.2012. sa sajta:

  • Njegomir V. Stojić D. (2010). Determinants of Insurance Market Attractiveness for Foreing Investments: The Case of Ex-Yugoslavia. Pula: Economic Research vol. 23. str. 99-110.

  • Organisation for Economic Co-operation and Development. (1993). Glossary of Industrial Organization Economics and Competition Law. Europe: OECD

  • Schaen M. and S. Maijoor 1997 The Structure of the Belgian Audit Market: the Effects of Clients’ Concentration and Capital Market Activity Internal Journal of Auditing 1(2) str. 151- 162.

  • Sohrab Uddin S.M. Gupta D. A. (2012). Concetration and Competition in the Non- Banking Sector: Evidence from Bangladesh. Global Journal of Management and Business Research. USA: Global Journal Inc. str. 80-88.

  • US Government Accountability Office. (2008). Audits of Public Companies - Continued Concentration in Audit Market for Large Public Companies Does Not Call for Immediate Action. Washington: GAO

  • U.S. Department of Justice and the Federal Trade Commission. (2010). Horizontal Merger Guidelines. United States: Department of Justice and the Federal Trade Commission Quick R. Sattler M. (2011). Das Erfordernis der Umsatzunabhängigkeit und die Konzentration auf dem deutschen Markt für Abschlussprüferleistungen. Zeitschrift für Betriebswirtschaft volume 81 str. 61-98.

  • Zakon o računovodstvu i reviziji Službeni glasnik RS br. 46/2006 i 111/2009.

Journal information
All Time Past Year Past 30 Days
Abstract Views 0 0 0
Full Text Views 245 148 5
PDF Downloads 135 96 2