Perspective Of Auditors Research Articles

Efikasnost tehničke revizije u energetikom sektoru - slučaj iz zemlje u razvoju

The paper examines the level and the factors that influence the effectiveness of technical audit in the power sector of Malawi from the perspective of auditors and auditees. Data was collected through a questionnaire that was analyzed using bivariate and multivariate statistics. Further to that, complementary data to measure the level of effectiveness was also collected and analyzed using the effectiveness calculator. Results show that the level of effectiveness of technical audit is low. Bivariate and multivariate analyses suggest that management support, organizational independence, and audit quality individually and collectively significantly influence the level of technical audit effectiveness.

Income smoothing and audit fees

In this study, we examine the effect of income smoothing on auditors' pricing decisions. Analyzing a sample of 12,823 firm-year observations from U.S. companies in non-regulated industries for the period 2000–2018, we find that income smoothing is negatively associated with audit fees, suggesting that auditors favorably view smoothed earnings. This result holds when we control for other variables that have been identified as determinants of audit fees in prior literature, including client-specific (e.g., client size, audit complexity, litigation risk, and corporate governance), auditor-specific (e.g., auditor quality, auditor tenure, and auditor expertise), and engagement-specific (e.g., audit opinion, busy season, reporting lag) factors. Our results also hold across (1) alternative smoothing measures (with and without considering the use of accruals to smooth earnings), (2) different sources of income smoothness (innate vs. discretionary components) and (3) various robustness tests. Overall, our evidence supports the notion that auditors perceive income smoothing as signaling rather than opportunistic behavior, and thus charge lower audit fees. To our knowledge, this is the first study that examines income smoothing directly from the perspective of auditors.

Bağımsız Denetçi Perspektifinden MaliyetlemeYöntemlerinin İşletme Fiyat Belirleme Kararları Üzerinde Etkisi: Ampirik Bir Çalışma (Effect of Costing Methods from the Independent Auditor Perspective on Business Price Determination Decisions; An Empirical Study)

Purpose – study aimed to examine the factors affecting the use of which businesses use and product over the auditing professional members working in the provinces of Bursa, Istanbul and others. Design / Method / Approach – By benefiting from the questionnaire questions belonging to the tested academic scales leading in the field of auditing, a model four variables, two independent, one intervening and one dependent, was formed. In this model, a total of five hypotheses were established. In order to test the model, the research based testing method (RBV) was used. questionnaire was administered via the permission basen on the 3rd June 2020 dated and 2020/3 numbered decision made by Bursa Uludag Universitesi Social Sciences and Humanities and Publication Ethics Committee. Design/methodology/approach – According to the findings, cost methods used by businesses have the highest effect on Businesses subjected to auditing are mostly using normal method. Businesses using method are able to calculate better prices. In the tables, it is observed that the auditors' annual auditing number is low and the sample distribution results of the study are significant. The records made in accordance with accounting system is very important in determination. Moreover, a significant positive relationship was found between “appropriate record and both calculation and pricing decisions. Discussion – According to the obtained results, four of five hypotheses proposed in the study were accepted and one was rejected. Auditors believe that professional institutions do not give sufficient support to businesses about the matter of calculation. It is observed that the auditors accept the existence of a significant positive relationship between method and pricing. In this respect, from an auditor's perspective, recording is required to be made in accordance the accounting system and POI (Public Oversight Institution) trainings require continuing. It was concluded that sufficient professional support, recording made in line the standards and the use of a method, businesses can work more competitive price offers.

Dynamic View of Pandemic Circumstances with Government Interventions and Socioeconomic Factors

ABSTRACTThe Novel Coronavirus Disease, COVID-19, was declared a worldwide pandemic by the World Health Organization (WHO) on March 11, 2020 (WHO 2020). Scientists in different fields have contributed to study the pandemic development and to provide support to government policies. However, the traditional measures of individual health, population health, and policy effects have received the criticism that many of them reflected the pandemic inaccurately and belatedly. This study evaluates the pandemic circumstances from the auditor's perspective, applies the system dynamics theory, and proposes dynamic models to understand the ongoing pandemic using business measurements and analytical technologies. This study also works on estimations of the feedback effects of pandemic-related policy measures. The deliverables of this study establish a dynamic view to understand the current pandemic and provide the government with a simulation tool to visualize the impacts of government interventions at different levels.

How Has the Change in the Way Auditors Determine the Audit Report Date Changed the Meaning of the Audit Report Date? Implications for Academic Research

SUMMARY Archival research in accounting often relies on the audit report date to capture the constructs of audit efficiency, audit timeliness, audit effort, or audit completion. Auditors' view of what constitutes sufficient appropriate evidence to support the audit opinion, and consequently the date of the audit report, previously coincided with the substantial completion of audit fieldwork, which would be days or weeks before a 10-K filing. However, this view has shifted to coincide with the timing of the public issuance of clients' financial statements (i.e., the 10-K filing date) following several regulatory actions, audit practice changes, and professional standard-setting changes occurring since the turn of the century. In this study, we present evidence of this shift in auditor perspective and discuss implications for academic research and standard setting.

Impact of external auditor–cloud specialist engagement on cloud auditing challenges

PurposeThis study aims to investigate the impact of external auditor–cloud specialist engagement on cloud auditing challenges from the perspective of auditors from the Association of Certified Public Accountants in a developing country as an example of Middle East emerging economies.Design/methodology/approachA quantitative research design was used to assess the influence of external auditor–cloud specialist engagement on three main cloud auditing challenges (i.e. technology security, regulatory standards and strategy). Data collection was conducted through field and online surveys. A total of 201 (181 male and 20 female) auditors made up a sample of a developing country’s economy. In addition, structural equation modelling was performed to test the proposed hypotheses of the study’s conceptual model.FindingsThe study found a significant effect of external auditor–cloud specialist engagement on overcoming the challenges of cloud auditing. Results showed that using IT specialists helps overcome strategic challenges more than other kinds of challenges, such as technology security and organisational standards.Practical implicationsThe findings suggest that efforts to promote cloud auditing in organisations may succeed if the focus is on overcoming cloud auditing challenges and highlighting the external auditor–cloud specialist engagement to enhance job performance.Originality/valueThis study is one of the few studies that analyse the impact of external auditor–cloud specialist engagement on cloud auditing challenges by adopting a quantitative approach from the perspective of auditors from the Iraqi Association of Certified Public Accountants.

An Auditor's Perspective of Executive Incentive Pay and Dividend Payouts in Family Firms

In family firms, where the family and the business domains are intertwined, conflicts from one domain can spill over to the other. Agency conflicts in the business domain can spread to the family domain and ruin the well-being of the families. Agency theorists suggest that corporate governance tools such as performance-based incentive pay and dividend payouts can be used to mitigate agency conflicts in widely-held firms. Previous studies in family firms, however, show inconclusive results. This paper aims to investigate whether incentive pay and dividend payouts alleviate agency conflicts in family firms, from an auditor’s perspective. Audit research shows that audit fees are higher for firms (auditees) with more severe agency problems. Thus, an audit fee premium (discount) can be a proxy for the severity (mildness) of agency conflicts. If a governance tool exacerbates (mitigates) agency conflicts in a family firm, it is expected to lead to an audit fee premium (discount). Using data from 150 largest listed companies in Hong Kong, the analyses show that the impacts of incentive pay and dividend payouts on audit fees are not uniform. Auditors view the governance tools as effective in mitigating agency conflicts only in some settings. This implies that the owning families should be cautious when implementing a governance tool. In some situations, a governance tool may aggravate agency conflicts in the business domain, which then can spill over to the family domain and adversely affect the family welfare.

Manajemen Risiko: Deteksi Dini Upaya Pencegahan Fraud

The economic costs of fraud in financial statements continue to be a problem for organizations and the public. The problem discussed in this study is limited risk management strategies to detect early for the prevention of fraud made by company managers and auditors. This strategy is important for proactive fraud prevention and for the integrity of financial statements in the future. The aim of this multi-case qualitative study is to explore early detection and methods of preventing fraud on financial statements using a conceptual framework of risk management. As a conclusion, there is a gap in the concept of risk management in current practice to detect and prevent fraud, and how the auditor's perspective in creating a proactive anti-fraud model. In addition, with this finding practitioners can develop proactive antifraud risk management procedures, and for auditors can develop early detection guidelines in fraud prevention

Auditoria interna e gestão: estudo de caso em uma universidade federal à luz da teoria institucional

Este estudo tem por objetivo analisar o processo de institucionalização da auditoria interna em uma universidade federal, na perspectiva de auditores e gestores. O estudo é desenvolvido à luz da Teoria Institucional, com apoio do modelo de análise proposto por Tolbert e Zucker (1998). No que diz respeito aos aspectos metodológicos, a pesquisa é de natureza qualitativa e assume a forma de estudo de caso único. Para coletar os dados, foram realizadas entrevistas com auditores e gestores da alta administração e análise de documental. Os resultados indicam baixa aderência ao estágio de habitualização e moderada aos estágios de objetificação e sedimentação do processo de institucionalização. Verifica-se que a auditoria interna em estudo: conta com boa estrutura física; mantém os procedimentos organizados; acompanhou o processo de modernização da atividade e que há apoio e reconhecimento por parte da alta gestão. Por outro lado, os resultados indicam que há necessidade de esclarecer as finalidades e a forma de atuação do setor na Universidade, de incrementar o processo de acompanhamento das recomendações emitidas e de ampliar o acesso a programas e sistemas de informação.

Post-implementation challenges of fair value measurement (IFRS 13): some empirical evidence

PurposeConsequent on the widespread of fair value (FV) accounting with the coming into effect of International Financial Reporting Standard (IFRS) 13, this study investigated the post-implementation challenges of FV measurement from the perspective of auditors in Nigeria.Design/methodology/approachData collection was through a structured-questionnaire administered on auditors from diverse audit firm backgrounds in terms of size, international affiliation and global presence. Statistical techniques such as cluster analysis, factor analysis and ANOVA were applied to analyse data obtained from 277 respondents.FindingsIt was observed that the severest challenge of FV measurement bothers on the paucity of information for valuation of items. The magnitude of the challenges of applying FV measurement in various industry sectors appears similar. Although audit firm attributes affect perception on the challenges, there is concurrence among auditors that manipulation of values of assets/liabilities with no market price during estimation, leveraging on non-availability of market information on assets/liabilities by managers to manipulate financial statements, inappropriateness/non-compliance of valuation methods with IFRS 13, and low level of awareness among preparers of financial reports are notable post-implementation challenges of FV measurement.Practical implicationsConsidering that the adoption of IFRS 13 impliedly places responsibilities on countries applying the standard to develop institutional structures that facilitate the valuation of items using FV measurement, it seems the establishment of such apparatus may be a sine qua non for fully realising the socio-economic benefits of applying FV accounting.Originality/valueThe study contributes to knowledge by exposing the practical challenges of FV measurement and accounting estimates typical of a developing country that has fully implemented international accounting standards. Moreover, findings from this study could be compared with the result of investigations conducted in other jurisdictions to gain a deeper and wider insight into the challenges of FV measurement with a view to proffering solutions to the post-implementation challenges of IFRS 13.

Odpovědnost auditora ve vztahu k transferovým cenám

Cílem článku je rozebrat odpovědnost auditora nejprve obecně a následně v souvislosti s transferovými cenami u spojených osob. Východiskem pro hodnocení transferových cen z pohledu auditu při ověřování účetních závěrek je pohled účetních předpisů a auditorských standardů. Článek, v návaznosti na rozbor odpovědnosti auditora, analyzuje rozhodování justice na základě vztahu zprávy auditora a transferových cen. Provedený výzkum vycházející z judikatury Nejvyššího správního soudu poukazuje na pochybení auditorů při vydání výroků k účetním závěrkám. Z výsledků výzkumu je patrné, že se auditor správnému nastavení transferových cen dostatečně nevěnoval. Důsledkem jsou pak nejen daňové doměrky, ale i nesprávně vykázané informace o nákladech (výnosech) a výsledku hospodaření účetních jednotek v jejich účetních závěrkách.

Does environmental disclosure have an auditing effect?

PurposeThe purpose of this paper is to investigate whether firms with high environmental disclosure have a low possibility of non-standard audit opinions and audit fees and whether this trend is more obvious after than prior to the Measures for the Disclosure of Environmental Information (Measure) implemented in 2008.Design/methodology/approachBased on the Measures implemented in 2008, the authors select data for the listed manufacturing firms from 2004 to 2006 (Pre-Measure) and from 2009 to 2011 (Post-Measure) as research samples to investigate the relationships between environmental disclosures, audit opinions and audit fees with difference in difference models. In addition, we also consider the influence of media attention, the polluting industry and internal control on the audit effect of environmental disclosure.FindingsThe results show that the level of environmental disclosure is significantly negatively correlated with the possibility of issuing non-standard audit opinions and audit fees after measure is implemented, especially hard environmental information. Further evidence indicates that the auditing effect of environmental disclosures is stronger on firms that receive less media attention, in firms with better internal controls, and in firms belonging to industries with heavy pollution.Originality/valueIn the Chinese setting, a high level of environmental information disclosures can effectively reduce the audit risk and lead to a high possibility of standard audit opinions and low audit fees. This effect is pronounced after issuing Measure. The conclusions suggest that measure and increasing environmental disclosure have an obvious positive audit effect and that firms should be forced or encouraged to disclose more environmental information from the perspective of auditors in China.

Auditing Estimates in Financial Statements: A Case Study of a Fish Farm's Biological Asset

AbstractRecent decades have witnessed an increase in the overall uncertainty inherent in financial statements. It is now common for the financial statements of a public company to include estimates with measurement uncertainties that exceed materiality. As a result, auditing students are now required to have a more profound understanding of (i) the impact of accounting estimates on risk assessment and (ii) the development of audit procedures to deal with accounting estimates. This case allows students to explore CAS 540 – Accounting Estimates by assuming the role of Atlantic Canada Aquaculture's (ACA's) auditor. ACA operates in Eastern Canada and is prohibited by Canadian regulations to catch and release the fish in their farm to determine their biological asset value. As a result, ACA developed a statistical model to determine the number and weight of the fish in their farm. The model is based on various estimates, such as water temperature, survival rates, and food quality. Students are required to explore the impacts of the model's estimates on the inherent risks in the financial statements and assess the reasonability of the model from an external auditor's perspective. The case also allows students to explore CAS 620 – Using the work of an Auditor's Expert and CAS 701 – Communicating Key Audit Matters in the Independent Auditor's Report in the context of the audit of biological assets.

Gestión del riesgo como eje articulador de un sistema de gestión integrado en las pymes

<p>En este artículo se presentan los resultados de una investigación realizada con el fin de reconocer la perspectiva de los auditores y coordinadores de sistemas de gestión sobre la aplicación del modelo de gestión del riesgo ISO 31000 y de aportar un modelo de gestión del riesgo que funcione como eje articulador y facilite la gestión integrada de las normas ISO 9001, ISO 14001 y OHSAS 18001, teniendo en cuenta los cambios futuros que tendrán estas normas. Para ello se realizaron encuestas a 26 auditores o consultores de sistemas de gestión y nueve entrevistas a coordinadores de sistemas de gestión en Pyme. El análisis de estas confirmó que las empresas objeto de estudio no realizan gestión del riesgo, no tienen en cuenta las partes interesadas ni el contexto donde existe la organización.</p><p>La investigación permitió identificar los elementos claves entre los sistemas de gestión ISO 9001, ISO 14001, OHSAS 18001 e ISO 31000, que contribuyen<br />a que la gestión del riesgo se convierta en el eje articulador de estos sistemas de gestión y no en un cuarto sistema de gestión, lo que facilita la gestión<br />integrada. Asimismo, el marco teórico y normativo, y los resultados del trabajo de campo aportaron significativamente a la definición del modelo de gestión<br />del riesgo y su articulación e importancia con las otras normas.</p>

Design and Comparative Analysis of MCDM-based Multi-dimensional Trust Evaluation Schemes for Determining Trustworthiness of Cloud Service Providers

This paper presents the design and comparative analysis of MCDM-based multi-dimensional trust evaluation schemes for determining trustworthiness of Cloud Service Providers (CSPs) in a cloud environment. The trustworthiness has been defined as the degree of compliance provided by a CSP to the promised QoS parameters as per the Service Level Agreement (SLA). Due to large number of CSPs offering similar kinds of services in a cloud environment, it has become a challenging task for Cloud Clients (CCs) to identify and differentiate between trustworthy and untrustworthy CSPs. We present the design and comparative analysis of three MCDM-based techniques (AHP, TOPSIS and PROMETHEE) that enable CCs to determine the trustworthiness of a CSP from different perspectives. All the three schemes enable us to assess the trustworthiness of a CSP from CC's perspective, Cloud Auditor's perspective, Cloud Broker's perspective and Peers' perspective. Experimental results show that all the techniques are effective and stable in differentiating between trustworthy and untrustworthy CSPs. The PROMETHEE technique has shown advantage over the AHP and the TOPSIS methods in the sense that it has reported less uncertainty during evaluations. The applicability and validity of the schemes have been demonstrated with the help of a case study involving the use of real cloud data.

Examining Quality Management Audits in Nuclear Medicine Practice as a lifelong learning process: opportunities and challenges to the nuclear medicine professional and beyond.

This essay will explore the critical issues and challenges surrounding lifelong learning for professionals, initially exploring within the profession and organizational context of nuclear medicine practice. It will critically examine how the peer-review process called Quality Management Audits in Nuclear Medicine Practice (QUANUM) of the International Atomic Energy Agency (IAEA) can be considered a lifelong learning opportunity to instill a culture of quality to improve patient care and elevate the status of the nuclear medicine profession and practice within the demands of social changes, policy, and globalization. This will be explored initially by providing contextual background to the identity of the IAEA as an organization responsible for nuclear medicine professionals, followed by the benefits that QUANUM can offer. Further key debates surrounding lifelong learning, such as compulsification of lifelong learning and impact on professional change, will then be weaved through the discussion using theoretical grounding through a qualitative review of the literature. Keeping in mind that there is very limited literature focusing on the implications of QUANUM as a lifelong learning process for nuclear medicine professionals, this essay uses select narratives and observations of QUANUM as a lifelong learning process from an auditor's perspective and will further provide a comparative perspective of QUANUM on the basis of other lifelong learning opportunities such as continuing professional development activities and observe parallelisms on its benefits and challenges that it will offer to other professionals in other medical speciality fields and in the teaching profession.

Activating The Role Of Audit Committees And Boards Of Directors In Restricting Earnings Management Practices: A Perspective Of Auditors In Jordan

The study objects for investigating the possibility of activating both audit committee and board of directors for restricting the practices of earnings management phenomenon. To achieve this objective, a questionnaire had been developed and self-administered for a selected sample consists of 123 auditors working in Jordan based on the simple random sampling method. The study first hypothesis is that audit committee can be activated in a form to restrict earnings management practices; the second hypothesis takes that boards of directors can be activated in a form that restricts earnings management practices. The third hypothesis states that activating both of audit committees and boards of directors together will restrict the practices of earnings management. One sample t-test, in addition to descriptive statistics had been used in data analysis and hypotheses testing. The finding of the present study show that audit committee, boards of directors, and both of audit committee and board of directors together can be activated to restrict earnings management practices.

Capital verification and auditor liability: evidence from China

Purpose– This paper aims to examine the different perspectives of auditors and non-auditors on this question, along with the rationale and impact of these differences. Chinese company law requires an audit report on paid-up capital when business entities are newly formed or their capital altered, which raises questions regarding the liability of auditors should the business entities fail.Design/methodology/approach– Interviews and a questionnaire survey were conducted to analyse how legislation can impact on interested parties in a relatively immature audit environment. The theories of social construction of reality and symbolic interactionism are used as a basis for explaining the different conceptions of capital verification held by interested parties.Findings– There is a mismatch between the purpose of capital verification and the functions of paid-up capital. Paid-up capital is not a reliable indicator of business liquidity and creditworthiness. Auditors and non-auditors have different understandings about the assurance provided by paid-up capital at the point of company formation or auditing field work, and at the point of actual trading after the company formation or auditing field work. They also differ on the causation between deficient capital verification reports and trading loss. The liability crisis adversely influenced auditors’ perception of the capital verification service, although it did not lead to outright rejection by them.Originality/value– This paper describes an important compliance auditing service in China. By conducting an analysis of the conflicting views of auditors and non-auditors on capital verification, it contributes to the existing literature on the sources of disputes between auditors and other stakeholders, and the efforts to establish a balanced auditor liability regime.

Auditing Subsequent Events from the Perspective of Auditors: Study from Jordan

The study aims to identify to what extent auditors in Jordan comply with the requirements of the International Standard of Auditing No. 560, Subsequent Events.The Researcher in the study used the descriptive approach and the analytical approach, through a questionnaire developed for the same purpose, and aims to answer the questions of the study, and to test hypotheses depending on a sample of (62) auditors working in auditing offices, they were selected randomly . The sample represents (32.8%) of the study population that consists of (189) auditing offices.The study shows that the auditors in Jordan comply with the requirements of the auditing standard No. (560) in auditing subsequent events in the period between the balance sheet date and the date of auditing report. They did not comply with the requirements of this standard after that date. The study shows also that the personal characteristics of the auditors (speciality, experience, CPA exams, and training) did not have statistically significant effects on their awareness of the importance of compliance with the requirements of this standard.The study recommends offices and auditing firms and the Association of Auditors to take care of training their auditors and employ only members who pass the CPA exam.

Auditors' identification with their clients: Effects on audit quality

Although client familiarity is desirable from the auditor's perspective, identifying with clients threatens auditor objectivity. This study examines the extent to which non-Big 4 auditors identify with clients, the effect of auditor–client identification on auditors' client acquiescence to client-preferred treatment, and, finally, whether the harmful effects of auditor–client identification can be extended to a broader set of reduced audit quality acts. The responses of 141 practicing auditors at non-Big 4 firms in Sweden support our theoretical predictions. We find that auditors tend to identify with their clients, and that an auditor who identifies relatively more with a client is more likely to acquiesce to client-preferred treatment and to commit reduced audit quality acts. While previous research has considered only Big 4 firms, the current findings suggest that the problems with auditor identification with clients also hold for non-Big 4 auditors.