Trends in the Tunisian Audit Market: A Descriptive Analysis of Market Leaders and Structure

The main objective of this paper is to analyze the structure of the Tunisian audit market, through the global and sectoral concentration of audit firms. Based on a sample of 55 Tunisian listed companies during the period 2003-2010, we have examined the structure of the Tunisian audit market by calculating the market share of each auditor and by measuring the market concentration through the Herfindahl index. We show that some sectors are more concentrated than others, with a specific choice of specialist auditors, corresponding in particular to the most regulated sectors such as telecommunications, banking, and financial services. However, in the agri-food, oil and gas, and health sectors, market concentration is decreasing and getting close to 0, an indication of intense competition and a tendency to "open oligopoly" for the Tunisian audit market. Overall, the results show a decrease in overall concentration following the rise in the ranking of national audit firms. The findings of the present study have potential relevance in encouraging regulators to implement policies that promote competition, and that represents an essential contribution to the debate on the issue of the level of concentration in the audit market.