Key Audit Matters UK 2013-2018

 The initial sample comprises all companies listed on the London Stock Exchange in 2013, as the UK was the first country in Europe to implement the disclosure requirements for key audit matters (KAMs) in ISA 701. As the UK regulations on extended audit reports only apply to company audit reports, we focused on companies with a premium listing classification whose auditors were required to file extended audit reports as of fiscal year-end 30 September 2013 or later. Due to the costs and effort involved in manual data collection, we focused our sample on companies with a premium rating in the 2013 fiscal year and manually collected KAMs for these companies from their first extended audit report (2013 or 2014, depending on their fiscal year-end date) until 2018. If we find an insolvent or merged company during our sampling period, we only include data for such companies up to the extended audit report of the latest available fiscal year.
After excluding the firm-year observation without all the data needed for our analysis, our final sample includes 1925 firm-year observations pertaining to 381 unique firms.