Financial Audit Report Research Articles

The Influence of Audit Fee, Audit Tenure, and Auditor Competency on Audit Quality: A Systematic Review

Financial audit reports play a crucial role in corporate decision-making, and their quality is impacted by various factors such as audit fees, audit tenure, and auditor competency. Audit fees refer to the costs associated with audit services, audit tenure signifies the duration of the audit firm's responsibility, and auditor competency encompasses the auditor's knowledge, skills, and attitudes. This study employs a systematic review approach, analyzing articles downloaded from the Google Scholar online database covering journals published from 2019 to 2023 using keywords like audit fee, audit tenure, auditor competency, and quality of financial audit reports. The research incorporates 10 quantitative journals, with 5 employing linear regression analysis, 4 using logistic regression analysis, and 1 utilizing the partial least squares method. The findings reveal that a majority of the journals demonstrate a positive and significant correlation between audit fees, audit tenure, auditor competency, and the quality of audit reports. Nonetheless, a few articles assert the absence of a relationship between audit fees, audit tenure, and audit quality. In summary, public accounting firms should regularly assess and formulate strategies concerning audit fees, audit tenure, and auditor competency to enhance client value by producing high-quality, accurate, and dependable financial audit reports.

Analysis of Liability for Defective Capital Contribution of Company Shareholders Based on Discrete Regression Algorithm

Abstract From the generation of defective capital contributions to the transfer of transactions, a series of civil disputes and liability responsibilities still need to be explored for a better solution. In this paper, based on the current research status of the defective capital contribution assessment model of enterprise shareholders, we combine the XG Boost model with good classification ability and the logistic regression model with good interpretability and construct a discrete regression (XG Boost-Logistic) model for the evaluation of the defective capital contribution of enterprises. Combined with the data of 123 shareholders’ capital contributions from enterprises’ financial audit reports, the XG Boost discrete model, the Logistic regression model, and the XG Boost-Logistic evaluation combination model were used to conduct empirical analysis and comparative experimental analysis with the evaluation indexes of the model. The research results show that the accuracy rate based on the XG Boost-Logistic evaluation combination model is 87.39%; the efficiency of liability assessment is improved by 7.35% compared with the XG Boost model and 12.38% compared with the Logistic regression model. XG Boost-Logistic evaluation combination model can effectively improve the liability prediction of capital contribution defects classification accuracy and provide a good explanation of shareholder liability classification at the same time and can help companies to avoid financial risks plays a key role.

PENGARUH COVID-19 TERHADAP LAPORAN AUDIT KEUANGAN DAN MANAJAMEN KEUANGAN (Studi Empiris Pada Indexs Saham LQ-45 yang terdaftar di Bursa Efek Indonesia 2018-2021)

The purpose of this study is to examine how COVID-19 will affect financial audit reports and financial management. Shares of LQ 45 businesses listed on the Indonesian stock exchange served as the topic of this quantitative study. with methods for gathering data, such as Non Probability Data gathering methods include observation, interviews, and conviniens sampling, with many samples having 45 respondents. Data analysis methods include descriptive analysis using SPSS.The findings revealed that: (1) The company's decision about which assets to manage was an investment decision. Additionally, the profitability of investments and the company's future cash flow are directly impacted by investment decisions. (2) Financing Decision, which is a choice that considers two factors: the best balance of spending (commonly referred to as the optimal capital structure) and the source of the cash required to finance the investment. (3) Asset Administration a choice on the level of operation of existing assets for which financial managers and other management within an enterprise are responsible.

Relationship of the Financial Audit Reports with the Going Concern Principle of the Manufacturing Companies in Dissolution and Liquidation of the City of Cuenca for the Period 2016 - 2021

Varias empresas de manufactura de la ciudad de Cuenca han tratado de mantenerse en el mercado, que cada vez es más competitivo, pero una pequeña parte, ha tomado la decisión de disolver y liquidar su empresa debido a factores económicos. El objetivo de este estudio es determinar la relación existente entre el principio de Negocio en Marcha y las Auditorías financieras basándonos en la selección de una muestra, teniendo en cuenta criterios que causan la disolución y liquidación, dictados por el ente regulador. También se tomó en cuenta la presentación del último balance presentado del 2016 al 2021 de las empresas que se encuentren en situación legal de Disolución y Liquidación; tomando en cuenta solo empresas manufactureras que estén domiciliadas en la ciudad de Cuenca. Se aplicó un modelo predictivo de insolvencia el modelo Z-Score de Altman, mismo que fue aplicado a las 5 empresas seleccionadas para el estudio, compuesto por dos modelos, el primer Modelo Z1 que está estructurado para aplicarse específicamente a empresas manufactureras que no cotizan en bolsa de valores, y el Modelo Z2 que enfatiza en la generación de rendimientos sobre el activo y su reinversión, el cual puede ser aplicado a cualquier tipo de empresa. El resultado final muestra una relación entre el informe de Auditoría Externa y el principio de Negocio en Marcha de las empresas manufactureras de la ciudad de Cuenca de un 40%, mientras que la no relación entre el informe y el principio de negocio en marcha representa un 60%.

Dig Here! Extracting and Using Knowledge from Financial Audit Reports

Financial audits establish trust in the governance and processes in an organization, but they are time-consuming and knowledge intensive. To increase the effectiveness of financial audit, we address the task of generating audit suggestions that can help auditors to focus their investigations. Specifically, we present NLP techniques to extract hidden knowledge from a corpus of past financial audit reports of many companies, and use it for generating audit suggestions. The extracted knowledge consists of a set of automatically identified sentences containing adverse remarks, the financial variables mentioned in each sentence and automatically assigned XBRL categories for them, since XBRL is a standardized taxonomy in the financial domain. In the absence of suitable labeled data, we adopted a weak supervision approach. We designed a set of high precision linguistic rules to identify adverse remark sentences, created automatically labeled training data using them, and trained BERT-based and other classifiers to identify such sentences. We next presented novel techniques (which are either unsupervised or zero-shot) to assign zero, one, or more XBRL categories to any given adverse remark sentence. We evaluated the proposed approaches, on a large corpus of real-life financial statements and audit reports, against competent baselines. Given a company’s financial statements (already identified as suspicious), and given a subset of financial variables in them that contribute to suspiciousness, we match these with the extracted knowledge base and identify aligned adverse remarks that help the auditor in focusing on specific directions for further investigations.

Analysis of the articulation of Local Government Financial Statements and Their Effect on Its Quality

This research aims to analyze the level of articulation of Local Government Financial Statement (LKPD) and their effects on the quality of LKPD as a basis for local government economic decision making. Data sources used in this research are secondary data and primary data. Secondary data consisting of LKPD documents with Unqualified Opinion. These documents were obtained from the Indonesian Supreme Audit Institutions’s (BPK) Financial Audit Report (LHP) in 2018. Secondary data analysis is carried out using content analysis techniques. The analysis is carried out by comparing the numbers of LKPD based on the set of articulation criteria that were built based on Government Accounting Standards (SAP) and previous research. Primary data consist of semi-structured interviews with local governments which have an articulation rate of less than 100%. Analysis of primary data from interviews is using the Miles and Huberman’s model. Based on the analysis of 443 LKPD documents, it was found that 131 or 30% LKPD had an articulation rate of 100% and 312 or 70% LKPD had an articulation rate of less than 100%. The average level of articulation of LKPD in Indonesia is 83% with the lowest articulation rate of 54%. Based on the results of interview, show that articulation affects the quality of financial statement and influences economic decisions in the the budget preparation process with the function of LKPD as a comparison and prediction tool.

Exploring Changing Requirements of Financial Statement Audit Reports via a Morphogenetic Approach

There has been an ongoing concern with the quality of financial audit reports issued by registered public accounting firms in relation to financial accountability and transparency of the financial statements. In July 2009 the Public Accounting Oversight Board (PCAOB) released a concept paper outlining changes to the requirements of financial audit activities such as the inclusion of the engagement partner’s signature on the financial audit reports. The aim of these new requirements was to improve the accountability of engagement partners as well as enhance the perception of transparency of the audit reports. However, the contribution and effectiveness of these requirements to improve accountability and transparency of audit reports for various stakeholders relying on the audited financial information is questionable. This study explores the impact and effectiveness of changes to auditing regulation and processes through the application of Archer’s (1995) morphogenetic approach which is based on social conditioning, social interaction, and social elaboration where the structural influences provides the environment for agents to differentiate themselves. In addition, this study demonstrates how proposed regulation changes mould the qualities of audit regulation, the profession and the auditor whose perspectives deserved to be noticed from the dominant constituencies structured by the propositions of a morphogenetic analysis.

An Empirical Study of The Determinants of Audit Report Delay in Indonesia Banking Companies

This study aims to analyze determinants of audit delay in banking companies listed on the Indonesia Stock Exchange (BEI). The analytical tool used is multiple linear regression models in 37 Indonesian banking companies from 2016 to 2018. Return on Asset, Debt to Asset Ratio, Auditor’s Opinion, and Firm Age are used as determinants of auditor delay. The result of the analysis shows that what affects audit delay in Indonesian banking is not based on the level of debt ratios or auditor opinion, but rather the level of profitability and company age A high level of profitability is good news that management wants to convey to stakeholders through the publication of financial audit reports that the company wants to convey quickly. The negative and significant effect between company age on audit delay shows that a company that has long been established and has experience and has better internal control management so that it can easily provide data for audience needs. Long established banks tend to have a large scale so that they have higher power and access to auditing firms to complete audits in a predetermined time.

ANALISIS HUBUNGAN TINGKAT KAPABILITAS APARAT PENGAWASAN INSTANSI PEMERINTAH (APIP) DENGAN KUALITAS PENGELOLAAN KEUANGAN HALAMAN JUDUL

Abstract The purpose of this study is to analyze the relationship between the level of government internal supervisory apparatus (APIP) capability and the quality of financial management. The researcher measured the quality of financial management of 42 local governments from various levels of APIP capability which are the research samples. The indicators used are the opinion of Supreme Audit Institution (BPK), the number of internal control weakness findings, the number of non-compliance findings, and the financial impact of non-compliance findings sourced from the financial audit report (LHP) of BPK on the local government financial statements (LKPD) for the fiscal year 2016. The result of the measurement was then compared and analyzed to determine the relationship between the level of APIP capability and the quality of financial management. Based on the analysis that had been done, it can be concluded that there is no significant relationship between the level of APIP capability and the quality of financial management. In addition, this study also identified factors that can explain why there is or there is no significant relationship between the level of APIP capability and the quality of financial management by conducting in-depth interviews with participants from the Sleman Regency Government, which is one of the research samples. Based on the analysis of interview transcripts and documents, it can be concluded that the absence of a significant relationship between the level of APIP capability and quality of financial management could be caused by the more dominant role of local government agencies (SKPD) in achieving the quality of financial management, the improvement of the level of APIP capability which is not followed by the significant improvement on the role and services of APIP, and the potential weakness during the process of assessment of the APIP capability.

FAKTOR-FAKTOR YANG MEMPENGARUHI PEMERINTAH DAERAH DALAM PENGANGGARAN

This study aims to analyze the factors that influence the compliance of local governments to legislation in budgeting. The independent variables tested in this research are the legislative quantity, the amount of regional income, and the previous year opinion of Audit Board of the Republic of Indonesia (BPK). Dependent variables are tested using educational spending. This study uses secondary data derived from the financial audit report on the financial statements of district and municipal governments in the province of Aceh for the period of 2014 and 2015. The sample of research is 23 district and cities in Aceh Province every year. The total population was 46 districts and cities from 2 years of observation. The analysis method used is multiple linear regression analysis. The results showed that the legislative quantity (X1) the relationship designated by the coefficient B to respond to the legislative amount of 0.476, the regional income (X2) is pure income by looking at the level of coefficient B. The relationship designated by the B coefficient of regional income is 0.070, and the previous year opinion of the BPK (X3) based on the coefficient B to respond to the BPK opinion of 0.416, simultaneously and partially have a positive effect on the compliance of legislation. K eyword : Educational spending, amount of regional income, legislative quantity,previous year opinion of BPK..

Determinant of the quality of the national financial audit report: study at National Auditor Board Jambi Province

This study aimed to examine the effect of training, experiences, gender, age and educational background possessed by the auditor on the quality of State Financial Audit results. This research used secondary data provided by Audit Board of the Republic of Indonesia Representative of Jambi Province in the form of 2016 and 2017 staffing data and Audit Reports. Multiple linear regression analysis was used for the analysis method. The study results found that the quality of the state financial audit was affected by experiences. However, the study failed to find the influences of age, education, and gender on the quality of state financial audit results. It provides empirical evidence that the auditor's ability to find and reveal findings has been influenced by experiences of the auditor

Financial Audit Report for 2017

Financial Audit Report for 2017

PENGARUH SOLVABILITAS, SEGMEN OPERASI, DAN REPUTASI KAP TERHADAP AUDIT DELAY PADA PERUSAHAAN MANUFAKTUR DI INDONESIA

Timeliness is one of the indicators used in the measure how quickly and accurately a company in publish financial reports in the context of decision making for investors. The information presented on time is considered able to provide a description of the condition that the company in a state of healthy both in the financial management internal control and routine operational activities. Audit delay is defined as a shift in the time that caused by delays in the settlement of the annual financial audit reports. This can occur because of a problem that appears not only from internal company but can also occur because of external factors. In this research we examined whether the solvency, operating segment of the company, and reputation Public Accountant (the big four and non-the big four) have an impact on the duration and scope of the work of the auditor. The object of this research is manufacturing companies listed in Indonesia Stock Exchange period 2011-2013. This research uses linear regression to test is whether or not the influence of solvency, operating segment and reputation Public Accountant to audit delay, aided by a software program eviews 6 and PASW Statistics 18. The results of this research are (1) the level of solvency of companies has positive effect on audit delay, (2) the number of business segments and the number of geographical segment has a negative effect on audit delay, (3) the reputation of Public Accountant has positive effect on audit delay.

Significance of financial audit reports for decision making of external corporate users

Availability of relevant and reliable information about business condition and results for all the actors in corporate governance very often has large or even crucial significance in economic decision making. Whether those are internal or external users, accuracy and the result of made economic decisions depends on the quality of the information in the presented financial reports. For those reasons it is important that financial reports are independently, objectively and professionally evaluated. Goal and assignment of the audit is to arrive to the knowledge and approve verity and objectivity of the information contained in financial reports by executing number of actions so that those information could be valid ground for economic decision making. Subject of this article is to appoint to the significance of auditor's reports for the decision making of external users of those information, for the perspective and success of a corporation.

A Study of the Relationship of Firm Characteristics and Corporate Governance with the Difference between Declared and Final Taxes in Iran

In the most cases, there is a difference between the tax declared by companies and the tax determined by tax authorities. The current study, aims the relationship of differences in declared and final taxes with some firm characteristics and corporate governance criteria in companies listed on the Tehran Stock Exchange including 102 listed companies (510 observations). The research hypotheses tested using the multiple linear regression (MLR) along with the generalized panel method of integrated data. The findings of the study indicate that there is a positive and significant relationship between interest expense coverage ratio, earnings before tax (EBT) to revenue ratio, and earnings before tax (EBT) to total assets ratio and differences in declared and final taxes; as a result, the higher the ratios are, the greater the tax wedge will be. Also, according to the results, no significant relationship is observed between differences in declared and final taxes and other variables including firm size and debt ratio, the ownership percentage of the big owner, presence of the state shareholder with minimum influence, independence of the board, and existence of the tax paragraph in financial audit report. DOI: 10.5901/mjss.2015.v6n4p488

Structure and Nature of Competition in the Market for Financial Audit Services in Mexico

The structural paradigm emphasizes that the nature of competition in a market, is closely related to the structure of the market and in particular its level of concentration. The objective of this research work is to present empirical evidence on the structure and nature of competition in the market for financial audit services in Mexico during the period from 2000 to year 2007. To do this, we have calculated several measures of concentration, using a sample of 1,344 financial audit reports of companies that are registered as issuers of shares in the capital market of the Stock Exchange in Mexico. The results show that the market for financial audit market in Mexico is highly concentrated and under the control of a few audit firms, specifically of Large International Firms, better known in the field business around the world as the “Big 4”. Also the results show that the nature of the competition in the market for financial audit services in Mexico is that, in imperfect markets, known as an oligopoly.

Financial Audit Report Modifications in Malta**

This paper analyses the modifications of financial audit reports of Maltese companies between 2005 and 2009. It examines the audit reports of a random sample of 374 limited liability companies registered with the Registry of Companies in Malta. The study shows that the average 2005-2009 modification rate in Malta stood at 22.4%, this representing an increase over previous periods. Most modified reports were noted in the case of private exempt and international trading non-exempt companies. Generally, private exempt companies had their audit report qualified on the basis of a limitation of scope, whilst most international trading companies had their reports qualified on the basis of disagreement with management. Furthermore, the “small company qualification” (which has been long abolished) was still incorrectly being used in Maltese audit reports till 2009. The results therefore show that there is still room for improvement in audit reporting in Malta. Whilst the Big Four audit firms do not appear to have issues in appropriately adhering to audit reporting standards, Maltese smaller audit firms and sole practitioners were found still to be the main cause for inappropriate audit reporting. Towards improvement, the study provides various recommendations including: a more consistent regulatory framework, stricter enforcement of quality assurance, and the reconsideration of the statutory small audit. Such recommendations may also be applicable to other jurisdictions.

Who manages Hospitals in Croatia?

The State Audit Office's Financial Audit Report on Hospitals for 2011 is currently in parliamentary procedure. Hospitals in Croatia are in a poor financial position and their uncontrolled management should as soon as possible be replaced by a regulated financial management system.

Lietuvos akcinių bendrovių išorinio finansinio audito išvadų tyrimas

The paper analyses changes of financial audit reports of Lithuanian corporations’ financial statements during the period of 2006-2011 as well as composition of audit companies that provided these reports.

SISTEM INFORMASI AKUNTANSI DALAM PENYAJIAN AUDIT FINANCIAL REPORT DENGAN MENGGUNAKAN COMPUTER ASSISTED AUDIT TECHNIQUES (CAATs)

The use of computerized technology in the current globalization era has become more rapid therefore assisting all activities in all fields, especially in the financial audit report in an accounting information system. Many problems were encountered with the auditors in conducting audits using conventional methods in an electronic data processing environment. However, these constraints are often ignored and do not get serious attention even by the auditors themselves. Inefficiencies resulted is often not oblivious. Therefore, constraints that occurred can be solved with a variety of ways, including the usage of Computer Assisted Audit Technique (CAATs) through a test data approach and Parallel Test Facility (PTF).Keywords: audit financial report, CATTs, accounting information system