Audit Requirements Research Articles

Privacy-Oriented Blockchain-Based Distributed Key Management Architecture for Hierarchical Access Control in the IoT Scenario

The rapid development of the Internet of Things (IoT) and the explosive growth of valuable data produced by user equipment have led to strong demand for access control, especially hierarchical access control, which is performed from a group communication perspective. However, the key management strategies for such a future Internet are based mostly on a trusted third party that requires full trust of the key generation center (KGC) or central authority (CA). Recent studies indicate that centralized cloud centers will be unlikely to deliver satisfactory services to customers because we place too much trust in third parties; therefore, these centers do not apply to user privacy-oriented scenarios. This paper addresses these issues by proposing a novel blockchain-based distributed key management architecture (BDKMA) with fog computing to reduce latency and multiblockchains operated in the cloud to achieve cross-domain access. The proposed scheme utilizes blockchain technology to satisfy the decentralization, fine-grained auditability, high scalability, and extensibility requirements, as well as the privacy-preserving principles for hierarchical access control in IoT. We designed system operations methods and introduced different authorization assignment modes and group access patterns to reinforce the extensibility. We evaluated the performance of our proposed architecture and compared it with existing models using various performance measures. The simulation results show that the multiblockchain structure substantially improves system performance, and the scalability is excellent as the network size increases. Furthermore, dynamic transaction collection time adjustment enables the performance and system capacity to be optimized for various environments.

A study of the interactions between internal audit function and external auditors in Italy.

This paper shows the results of a research study whose main objectives have been to understand the way and the extent of dependence and consideration which the directors of internal audit departments and the partners in external audit firms have of each other. We relied on the exploratory research methods that examine the level of operative co-operation and activity co-ordination between Internal audit functions and auditing firms through questionnaires and interviews. The findings suggest that mutual collaboration increases the reliability of controls and that, at least in part, avoids duplication of work, although there is no full agreement on the usefulness of the internal audit outcome for the external auditor activities. These findings are particularly relevant given the growing emphasis on the role of Internal Audit as an important corporate governance mechanism and on the new challenges faced by external auditors in the form of greater audit requirements. Overall, our findings have practical implications for both (i) external auditors who are evaluating the role of internal audit functions and its usefulness and (ii) CAEs who could on their turn increase the efficiency and effectiveness of internal audit functions. This article also provides a contribution to the literature examining public companies internal and external audit interrelationships as well as the literature on audit effectiveness and performance.

Assessment of Public Hospital Governance in Romania: Lessons From 10 Case Studies.

Background: The Government of Romania commissioned international technical assistance to help unpacking the causes of arrears in selected public hospitals. Emphases were placed on the governance-related determinants of the hospital performance in the context of the Romanian health system. Methods: The assessment was structured around a public hospital governance framework examining 4 dimensions: institutional arrangements, financing arrangements, accountability arrangements and correspondence between responsibility and decision-making capacity. The framework was operationalized using a 2-pronged approach: (i) a policy review of broader health system governance arrangements influencing hospital performance; and (ii) a series of 10 casestudies of public hospitals experiencing financial hardship. Data were collected during 2016-2017 through key informant interviews with central authorities and hospital management teams, exhaustive semi-structured questionnaires filled in by hospitals, as well as the review of documentary sources where feasible. Results: Overall, the governance landscape of Romanian public hospitals includes a large number of seemingly modern legislative provisions and management instruments. Over the past 30 years substantial efforts have been made to put in place standardised hospital classification, hospital governance structures, management and service purchasing contracts with key performance indicators, modern reimbursement mechanisms based on diagnosis-related groups (DRGs), and regulatory requirements for accountability, including internal and external audit. Nevertheless, their application appears to have been challenging for a range of reasons, pointing to the misalignment between the responsibility and decisionmaking capacity given to hospitals in a questionably conducive context. Incoherent policy design, outdated and often disjointed regulatory frameworks, and cumbersome administrative procedures limit managerial autonomy and obstruct efficiency gains. In a context of chronic insufficient funding, misaligned incentives, and overly rigid service procurement processes, hospitals seem to struggle to adjust service baskets to the population’s health needs or to overcoming financial hardship. External challenges, combined with the limited strategic, operational, and financial management capacity within hospitals, make it difficult to exhibit good financial and general performance. Conclusion: Existing governance arrangements for Romanian public hospitals appear conducive to poor financial performance. The suggested framework for hospital governance assessment has proved a powerful tool for identifying system and hospital-specific challenges contributing to sub-optimal hospital performance.

The complexity of bank regulation: audit requirements in the USA

We use requirements governing external audits in the US banking industry as a case study to illustrate the complexity of regulatory structure. Complexity reflects a flexibility that has been used to “tailor” regulations for particular categories of banks. But it appears to conflict with recent proposals to “rationalize” a system that is said to lack coherence.

Do Mandatory Energy Audits Reduce Building Energy Use?: A Bayesian Analysis of New York City's Local Law 87

Cities are experimenting with a range of policy and regulatory tools to reduce energy use in the building sector as a pathway to substantial carbon emission reductions. Increasingly, cities are turning to policies that reduce information asymmetries and knowledge gaps through data transparency, focusing on existing buildings and the potential to achieve up to 50% energy savings through retrofit adoption. These include energy disclosure - or benchmarking - ordinances and, more recently, mandatory energy audit requirements. While energy benchmarking is a relatively low-cost mandate, energy audits impose non-trivial costs in terms of capital and time for building owners. The question we explore here is whether mandatory energy audits lead to reduced energy consumption over time. We collect detailed energy use and building attribute data from 2011 to 2016 for approximately 4,000 buildings in New York City and integrate with a unique dataset of mandatory energy audit reports for a randomly selected sample conducted in 2013 and 2014. We use non-parametric statistical tests and Bayesian regression to evaluate the impact of energy audits on building energy performance, compared to a control group of matched buildings not subject to the audit requirement. We find that mandatory energy audits have a modest negative impact on energy consumption, consistent with savings expected from low-cost energy conservation measures and retro-commissioning activities. The result reinforces the hypothesis that audits, by themselves, create an insufficient incentive to invest in energy efficiency upgrades at the scale needed to meet city carbon reduction goals.

PENGELOLAAN PERGURUAN TINGGI KEAGAMAAN ISLAM NEGERI BERBASIS SNI ISO 9001:2008

This paper attempts to address the problem of how to manage the State Islamic Religious College (PTKIN) based on ISO 9001: 2008. Problems become important because in the era of the Industrial Revolution 4.0, quality human resources (HR) cannot be bargained again. The only way to improve the quality of human resources is through education, especially higher education institutions, including the State Islamic Religious College (PTKIN). So that the quality of PTKIN is not less competitive with other universities in Indonesia, the management of PTKIN must be based on ISO 9001: 2008 as one of the principled quality management of TQM in detailed and systematic application. The ISO 9001: 2008 system is a means or tool of PTKIN to achieve the expected quality objectives and is able to answer the challenges of the current Industrial Revolution 4.0 era. In addition, there is a periodic internal quality audit requirement. At present ISO 9001: 2008 is the main choice for higher education institutions, PTKIN to implement a quality management system consistently and systematically to achieve effectiveness and efficiency. The application of ISO 9001: 2008 at PTKIN is very important as a step to realize and provide good governance, achieve excellent education practices, improve customer satisfaction and provide a better response to industry needs. PTKIN's main motive for implementing ISO 9001: 2008 is as a promotional step to provide an overview that PTKIN has high quality, high visibility and credibility, response to external factors and to develop an overall quality management system, so as to provide services and output the best that can guarantee the satisfaction of all customers and stakeholders.

Corporate Governance on the Performance of Internal Auditors in Thailand Public Limited Company

<em>The issue of performance of internal auditors is important since Thailand was also affected by the accounting scandals. The expanded scope in the definition of internal auditing and new regulatory requirements such as the Sarbanes-Oxley Act 2002 has increased the demands on internal auditing. This study was conducted to examine the relationship between the corporate governance on the performance of internal auditors in Thailand public limited companies. In this study, corporate governance relates to the board of directors size and audit committee size to the performance of the internal auditor. To achieve this objective, two hypotheses were developed based on previous studies and the agency theory. Survey questionnaires were sent to the Chief Audit Executives (CAEs) to determine the effectiveness on their performance based on the professional standards issued by the IPPF (2017) indicators. A total of 520 questionnaires were distributed, but only 146 were usable. Multiple regressions were used to test the relationship between the variables. The result showed that there is insignificant relationship between board of director’s size and internal auditors’ performance. This study however found that audit committee size has a positive relationship on the performance of internal auditors. Therefore, audit committee need to increase higher responsibility with regard to corporate governance by overseeing financial reporting and internal control matters.</em>

Auditor choice in private firms: a stakeholders perspective

PurposeThis paper aims to examine whether a private firm’s demand for a Big4 auditor is influenced by the auditor choice of its main supplier, customer and competitor. The authors rely on institutional theory to explain this stakeholders’ influence. The authors also examine whether the extent to which the firm’s board of directors engages in networking moderates this influence.Design/methodology/approachQuestionnaire data are combined with archival data of 210 Belgian private firms with a statutory audit requirement. Logistic regression analysis is applied to examine to what extent firms follow their main competitor, customer and supplier in hiring a Big4 auditor.FindingsThe results reveal a positive association between the firm’s choice of a Big4 auditor and its main supplier being audited by a Big4 auditor, supporting the conformance effect (isomorphism) toward suppliers as hypothesized by institutional theory. The extent of board networking, however, seems to weaken this effect. Toward competitors, a divergence effect instead of a conformance effect is found, which indicates the existence of competitive differentiation regarding auditor choice.Research limitations/implicationsWhile prior studies mainly focus on the agency relationships between shareholders, debtholders and managers to explain auditor choice, this study also takes into account the firm’s other main stakeholders by relying on institutional theory. Both the conformance effect toward suppliers as well as the divergence effect toward competitors provide interesting additional perspectives on why auditors are demanded, leading to interesting future research opportunities.Originality/valueThis paper fulfills an identified need to consider additional theories in explaining audit outcomes.

Neovisnost zakonskog revizora u odnosu na subjekte revizije prema Zakonu o reviziji iz 2017. godine

Zakon o reviziji iz 2017. godine uvodi opće zahtjeve za obavljanje zakonskih revizija u svim obveznicima zakonske revizije te posebne zahtjeve koji se primjenjuju na zakonske revizije u subjektima od javnog interesa. Cilj je tih odredbi jačanje neovisnosti i objektivnosti zakonskih revizora u odnosu na subjekte revizije, uzimajući u obzir nedostatke u poslovnoj praksi revizora u razdoblju od 2007. godine do danas. Također se jača javni nadzor Ministarstva financija nad radom ovlaštenih revizora i revizorskih društava. Zakon je usklađen s odredbama Direktive o zakonskim revizijama iz 2014. godine te upućuje na izravnu primjenu odredbi Uredbe o zakonskim revizijama u subjektima od javnog interesa iz 2014. godine.

Changes in Corporate Governance Structure and the CompaniesAct Audit Requirements

Changes in Corporate Governance Structure and the CompaniesAct Audit Requirements

Improving safety and quality in regional anesthesia: An innovative app for Indian national regional anesthesia audit database, regional anesthesia database App

Regular audit of our own practice has shown to improve quality and safety. Practitioners across the world are able to do it at individual levels but are unable to benchmark it due to unavailability of national or international data. Regional anesthesia has seen an exponential growth in the recent years [1]. In the enthusiasm, many are adopting the newer techniques without appropriate training. Do they know, how well they are doing?, Do they know, they are not causing any harm, and do they know, they are up to standards? In the end, we are all accountable for the service we provide to our patients, surgeons, and institutions [2]. Audits are contractual requirement across many institutions and medical boards around the world. Many anesthetists are quite aware of the audit requirements in their practice but rarely have the time and resources. Moreover, there are significant hurdles and difficulty in establishing clinical audits in real-world practice [7, 8].

Financial Reporting Choices of Large Private Firms

We perform the first study of the fundamental financial reporting choices – audit, auditor, accounting standard, internal controls audit – of private funds (e.g., private equity, hedge funds, etc.), which represent an increasingly important component of the economy. We find that nearly 80% of private funds that are not subject to mandatory audit requirements obtain audits voluntarily. Larger, older funds with more owners and a higher level of sophisticated ownership are more likely to obtain audits, while funds with a higher level of inside ownership are less likely to obtain audits. Many of these characteristics are also associated with the likelihood of funds engaging a Big 4 auditor, obtaining an internal controls audit, and preparing GAAP financial statements. The growth and creation (termination) of private funds is positively (negatively) associated with funds’ preparation of GAAP financial statements or engagement of Big 4 auditors, providing new evidence on the value of financial reporting in the capital formation process. Overall, our evidence suggests that high-quality financial reporting aids private funds’ capital formation and that funds’ agency costs and the information needs of their equity investors influence funds’ financial reporting choices.

Redesigning the Peer Audit Process to Enhance Clinical Dialogue.

This case report describes the process used to engage clinicians in redesigning the peer audit system and the outcome of this effort at the Rehabilitation Therapies department of the University of Vermont Medical Center in Burlington. A wide variety of peer audit processes, tools, and requirements have been used across disciplines and clinical sites. Rehabilitation therapy staff participated in a group project using a project charter to design the new approach to the peer audit. A single peer audit tool and unified audit process were developed for use across therapy disciplines and care settings. A survey was used to collect pre- and postrevision data. Responses to all survey questions indicated favorable change. Broad engagement of clinical staff in the redesign resulted in a peer audit process that was completed more consistently and was more likely to be perceived as resulting in meaningful discussion, encouraging critical thinking, and improving clinical skills.

Environmental Audit for Environmental Improvement and Protection

Abstract The main purpose of this paper is to explain the ways in which environmental audit contributes to improving and preserving environmental protection, respecting the concept of sustainable development. The paper uses methods of analysis, synthesis, analogy, and continuity. Specifically, to draw conclusion about the impact of environmental audit on environmental improvement and protection, first of all, relevant and available foreign literature and practice are consulted. Research results show direct link between environmental audit requirements and protection and improvement of polluting enterprises’ environment. Practical applicability of research results consists in giving specific proposals to reduce pollution and improve environmental protection. Furthermore, the most appropriate form of environmental audit report is proposed. Originality and importance of research conducted in this study consist of proposals for introduction, implementation, control, and continuous improvement of environmental protection, through internal and external environmental audit in enterprises of the Republic of Serbia.

Joint audit, audit market structure, and consumer surplus

We use a structural application of the discrete choice model to investigate how the introduction of a joint audit policy would affect audit market structure and consumer surplus. We perform this policy evaluation by identifying demand fundamentals in a joint audit regime and applying them to a single audit regime. We find that a joint audit requirement has the potential to change the audit market structure substantially but that the effects are sensitive to the specific policy design. For example, small audit firms gain market share in a joint audit regime but only if an equal sharing of the workload between the two joint auditors is not required. Our counterfactual analysis reveals that the introduction of a joint audit regime would be associated with a substantial loss of consumer surplus. The loss results from restricting clients from giving all of the audit work to their most preferred audit firm, but it is partly offset by gains in consumer surplus deriving from the opportunity to choose the best combination of auditor pairs.

Framework for Management and Control of Marine Pollution in Nigeria Seaports

Existing studies show that effort made so far in curtailing marine pollution in ports of developing economies is marred by lack of administrative controls and inadequate provision of waste reception facilities at the ports. In this paper, sources of marine pollution and effects of particularly ship-based pollutants on marine environment were examined. The institutional arrangement for addressing marine pollution from ships visiting Nigeria ports is evaluated within the context of Marine Pollution (MARPOL) convention provisions and the obligations of coastal, flag states and port state control in ensuring compliance. It was found that in Nigeria ports, ship-generated waste control services and provision of waste reception facilities are outsourced to a private company with no requirement for activity audit. Apart from the Nigeria Port Authority (NPA), other government agencies are also involved in pollution monitoring and control. Given this scenario, it is envisaged that functions could be duplicated and monitoring/control efforts potentially weakened by conflicts of interests. An integrated administrative framework model is therefore proposed to address these managerial issues. Policy implications of the model developed are discussed.

Audit fee discounting in the post-SOX environment

PurposeThis paper aims to investigate whether the expected implementation of Section 404(b) of the Sarbanes-Oxley Act (SOX 404(b)) (the integrated audit requirement) caused auditors to discount their audit fees for non-accelerated filers in anticipation of expected increased future economic rents (DeAngelo, 1981) from those clients.Design/methodology/approachThis paper predicts that auditors charged their non-accelerated filer clients lower audit fees during the years 2005-2007 (in anticipation of increased expected future economic rents from the implementation of the SOX 404(b) requirement) compared with the years 2010-2012 (when it had been determined that non-accelerated filers were permanently exempt from complying with SOX 404(b)). The authors use ordinary least squares regression analysis to examine whether audit fees increased significantly for non-accelerated filers after the permanent exemption announcement.FindingsThe results show a significant positive association between the exemption announcement and audit fees, supporting the theory that auditors discounted their audit fees for non-accelerated filers in the pre-exemption announcement period. This finding is robust when sensitivity tests are used.Practical implicationsThe findings of audit fee discounting literature related to the post-SOX period are mixed. This study adds to this stream of literature by supporting the notion that audit fee discounting is being practiced post-SOX and is a potential unintended consequence of SOX 404 and the exemption. Thus, investors will be interested in the results of this paper when making their investment decisions with regard to non-accelerated filers.Social implicationsThe results of this paper show that, even in the post-SOX environment, auditors will employ the use of audit fee discounting if a change in regulation incentivizes it. This commentary on the present state of the audit pricing market should be of interest to audit pricing policymakers.Originality/valueThis paper is one of the first to study audit fee discounting outside the realm of initial audit engagements.

An Analysis of Ship-Source Marine Pollution in Nigeria Seaports

Existing studies indicate that marine pollution control in the ports of developing economies is marred by a lack of administrative control and inadequate provision of waste reception facilities. In Nigeria ports, ship generated waste control services and provision of waste reception facilities are outsourced to private companies with no requirement for an activity audit. Apart from the port authority, other government agencies are also involved in pollution monitoring and control. Hence, functions are duplicated and effective regulation is arguably weakened by conflicts of interest. A scientific based integrated model is therefore proposed to address the managerial problem posed in the control of marine pollution in Nigerian ports. In this paper, we conduct a physico-chemical and microbiological analysis of samples of ships’ wastewater to determine the status of marine pollution in the port environment. The samples were collected from randomly selected ships at berths in seaport locations. The outputs from the analysis are then integrated as inputs into an administrative framework model. The integrated model developed is proposed as an alternative administrative tool for monitoring and controlling pollution in seaports. The policy implications of the developed model are discussed.

Certification of aUniversity Department of Otolaryngology according to DINENISO9001:2008

Quality management (QM) is acontrol tool for the implementation of awide range of organizational measures aimed at achieving process orientation and process optimization. The organizational framework for these measures can be structured to fulfill the requirements of certification to the DIN EN ISO9001 standard. The objective was to implement this tool within auniversity otorhinolaryngology department. After drawing up aproject plan, the measures required to fulfill the audit requirements were put into practice by aQM core team, which included employees from four areas: healthcare, research, nursing and teaching. The measures carried out resulted in the achievement of certification, provided that annual surveillance audits are performed. The attainment of the certificate requires continuous fulfillment of the required standards. Future requirements, such as the demands placed on knowledge management, necessitate further appropriate measures.

EUROPEAN REQUIREMENTS REGARDING THE AUDIT REPORTING

In recent years, reporting requirements on the statutory audit have been revised and amended to increase the audit report’s communication value. In addition to the stipulations of the International Auditing Standards Package on reporting, revised and enforceable on 15 December 2016, the European Union issued the Directive 2014/56 / EU amending Directive 2006/43 / EC on statutory audits of annual financial statements and consolidated financial statements and EU Regulation no. 537/2014 on specific requirements for the statutory audit of public interest entities, both of which were published on the same date, June 17, 2014 and with the same application deadline, June 17, 2016. These normative acts foresee increased requirements for the reporting procedure in the statutory audit. Thus, the Directive provides for additional content requirements for the audit report, and the regulation requires additional information in the report but also the issuance and provision of other reports by the auditor: report to the audit committee of the public interest entity; In some cases, a report to the public-interest entity's supervisory authority or to the auditor's supervisory authority, and a transparency report published annually on the auditor's website. Our article details this information with direct reference to the content of these European official documents.