Substantive Procedures Research Articles

Argumentative writing by junior high school students: discourse knowledge and writing performance / Escritura argumentativa en alumnos de secundaria: conocimiento sobre el discurso y rendimiento en la escritura

This study examined junior high school students’ knowledge about the process of argumentative writing and whether discourse knowledge predicted students’ writing performance. Participants were 26 ninth grade students (aged 13–15). Students wrote an argumentative text and responded to questions assessing their declarative knowledge about writing in general, and their declarative, procedural and conditional knowledge about argumentative writing in particular. Students’ responses describing the argumentative writing process were mainly centred on substantive and production procedures, on abilities associated with writing and on seeking assistance for text composing. Descriptions were mainly focused on opinion writing, omitting the importance of taking an argumentative position and of using evidence to support arguments and counterarguments. A reduced number of students considered the need to accommodate their writing to a potential reader. In addition, knowledge of substantive procedures and knowledge of reader’s fit were significantly correlated with writing quality and planning complexity.

A Crucible for Corrective Justice: Legislative Experiments with ADR to Reform the Medical Malpractice System

The American tort system has been the target of medical malpractice reform efforts for close to fifty years. Using different “crisis” narratives, reform advocates argue that litigation costs must be contained, that alternative methods for compensating injured patients should replace the tort system, and that healthcare delivery systems must change to reduce the incidence of patient injury. In pursuit of these different reform objectives, state legislatures enact laws that, for medical malpractice claims, change both substantive tort doctrine and procedure. For procedural reforms, policymakers turn repeatedly to ADR to fix perceived problems with the medical malpractice system, enacting statutes that mandate or direct parties to utilize specific ADR processes. This Article argues that ADR procedural interventions have substantive reform goals in the medical malpractice context. Ironically, these successive generations of medical malpractice ADR demonstrate a diminishing primacy of tort, rendering ADR not only an alternative process but also a venue for alternative models of corrective justice.

From Assange to Zentai: interpretative conjunctions between international and domestic extradition law in Australia and the United Kingdom

ABSTRACTAs a process of formal surrender by one country to another of a person accused or convicted of an offence, extradition has both an international and a domestic operation. This article critically examines the manner in which superior courts in the United Kingdom and Australia determine the domestic and international meaning of words such as ‘accused’, and resolve discrepancies between those meanings, when interpreting and applying extradition treaties and the legislation by which extradition treaties are given domestic effect. It is argued that the difference in interpretative approach between the two jurisdictions is a result of the different backgrounds against which particular cases have arisen, as well as the Australian judicial departure from the position that incorporated extradition treaties should be interpreted by reference to public international law principles of treaty interpretation. However, neither jurisdiction has yet sufficiently resolved how the meaning of a word in an extradition treaty is to be applied as between the substantive law and procedure of different countries.

Methodological Approaches to the Assessing of the Quality of Audit Sampling

The main objective of this study is to develop methodology of assessing the quality of the audit sampling. The use of the sampling leads to existence of the risks when an auditor's conclusion, made on the basis of a total sample may be different from the conclusion drawn on the basis of the audit procedures carried out in respect of all population elements. To solve this problem we have created the theoretical model, illustrating the following: the relationship between the audit risk and the methods of the unit’s selection; the relationship between the efficiency of the audit, evaluation of internal control and audit scope; the use of sampling in the audit for internal control testing and substantive procedures. DOI: 10.5901/mjss.2014.v5n24p176

Between a Rock and a Hard Place: A Path Forward for Using Substantive Analytical Procedures in Auditing Large P&L Accounts: Commentary and Analysis

SUMMARYSubstantive analytical procedures can be an important and effective audit tool to gather evidence and highlight areas of potential misstatement, and for decades have been one of the common substantive procedures applied to income statement accounts. Recently, however, there is a growing trend for public company auditors to forego substantive analytical procedures on large income statement accounts, such as revenue, due to criticisms from regulatory inspectors that such procedures are not capable of providing useful substantive evidence. In this commentary, we address the concern that discouraging the application of appropriately rigorous substantive analytical procedures may diminish overall audit quality. We consider whether rigorous substantive analytical procedures can be designed to provide useful evidence at moderate and low levels of assurance for large income statement accounts, such as revenue, even when the significant-difference threshold exceeds overall materiality. Such procedures can provide strong evidence that financial statements are free of massive fraud or unintentional misstatement. Further, the moderate or low assurance obtained by such substantive analytical procedures can be combined with assurance provided by other audit procedures to yield high overall assurance. We illustrate one potential approach that may be useful in designing substantive analytical procedures to achieve moderate or low assurance and we explain how our approach is consistent with auditing theory and auditing standards.

Labour Disputes: Issues Relating to Substantive Law and Procedure in the Legal Process

This study addresses issues relating to procedural and labour law regulations governing legal proceedings in labour disputes, such as re-instatement cases, in the courts of general jurisdiction. Emphasis is placed on issues relating to the time limits set for filing employment lawsuits and the manner whereby these time limits shall be counted. The study provides grounds for a proposed change in the rules of territorial jurisdiction over labour disputes and identifies issues relating to evidence relevance and evidence admissibility in re-instatement law cases. The study highlights challenges associated with the presentation of evidence by employees. Special attention is given to imperfections in the statutory dismissal procedure. The study offers a dismissal procedure for each ground for employee dismissal set forth in Article 81 of the Russian Federation Labour Code and proposes ways to streamline the labour and civil procedural laws in the context of the issues addressed.

Between a Rock and a Hard Place: A Path Forward for Using Substantive Analytical Procedures in Auditing Large P&L Accounts: Commentary and Analysis

Substantive analytical procedures can be an important and effective audit tool to gather evidence and highlight areas of potential misstatement, and for decades have been one of the common substantive procedures applied to income statement accounts. Recently, however, there is a growing trend for public company auditors to forego substantive analytical procedures on large income statement accounts, such as revenue, due to criticisms from regulatory inspectors that such procedures are not capable of providing useful substantive evidence. In this commentary, we address the concern that discouraging the application of appropriately rigorous substantive analytical procedures may diminish overall audit quality. We consider whether rigorous substantive analytical procedures can be designed to provide useful evidence at moderate and low levels of assurance for large income statement accounts, such as revenue, even when the significant-difference threshold exceeds overall materiality. Such procedures can provide strong evidence that financial statements are free of massive fraud or unintentional misstatement. Further, the moderate or low assurance obtained by such substantive analytical procedures can be combined with assurance provided by other audit procedures to yield high overall assurance. We illustrate one potential approach that may be useful in designing substantive analytical procedures to achieve moderate or low assurance and we explain how our approach is consistent with auditing theory and auditing standards.

Negative Effects of Incorrect Legal Transplantation of European Union Legislation

Abstract In the context of Romania's accession to the European Union, there was implied responsibility to adapt the country's legislative and judicial system to European system in order to implement the legal standards created and adopted by the European Union. This was transplanted adaptation which aimed, more clearly, for a potential unification and standardization of the Member States’ legal systems. Against the background of this transplantation and adaptation, legislative and judicial national systems encountered a series of practical difficulties. In considering the diversity and particularity of a new European legal system, there were, even, reactions of rejecting some of the European legal norms of transplantation. Extending the law's area of substantive procedures was a result of mutations of the Members States’ legal systems by creating a new European legal order. Identifying and eliminating the negative effects of defective transplantation of European legal standards might lead to prevention of the national legal system's possible legislative and legal vulnerability. If, the legal system's causes and negative effects considered by European Union to be a lacunary, could be identified, a series of solutions could be found which would improve the national legal system's functions and, which, in a certain period, could eliminate forever the system's difficulties.

Efficacy of two gingival retraction systems on lateral gingival displacement: A prospective clinical study

PurposeGingival management is a substantive procedure in fixed dental prosthesis treatment. Various new retraction cord systems are available and used. This study aimed to compare the efficacy of a new retraction cord (Stay-Put, Coltene Whaledent AG) and a conventional retraction cord (Ultrapak, Ultradent Products Inc., South Jordan, Utah) on lateral gingival displacement in continuation with the treatment protocol of the subjects fixed dental prosthesis for various partial edentulous conditions requiring fixed dental prosthesis. MethodThirty subjects were selected who needed bilateral fixed dental restoration. In selected subjects both gingival retraction cords were placed bilaterally buccolingually by simple randomization method. After removing the cords, impressions were made and undamaged definitive casts were retrieved. The abutment teeth were sectioned buccolingually at the buccal ridge followed by decimal measurement of the width (in millimeter) of the retracted gingival sulcus, under a traveling microscope. ResultsData was analyzed using SPSS version. Paired "t" test was used to compare the difference between the displaced gingival width in two retraction group (p > 0.05). ConclusionAlthough mean gingival retraction in Stay-Put system (0.528 ± 0.12 mm) was higher as compared to that in Ultrapak (0.487 ± 0.10 mm), the difference between the two systems (0.041 ± 0.11) was not significant statistically (p = 0.057).

The European Commission's Programme for State Aid Modernization

The European Commission has set out a modernization programme for state aid. This affects both substantive state aid law and administrative procedures. On substance, while the Commission has no power to change the meaning of state aid, which is derived from Article 107 TFEU and is a matter of law ultimately for the CJEU, it intends to issue a detailed Notice on the notion of aid, in particular in relation to fiscal aid and application of the market investor principle. More proactively, the Commission is revamping the system of assessment and exemption, with a plan to reform the general block exemption and the various guidelines on, for example, environmental protection, research and development and innovation, risk capital and restructuring aid. A more analytical approach, weighing up the economic effects, will be carried out in assessing compatibility. On the procedural side, the main reform is intended to lessen the Commission's administrative workload by reducing the number of complaints that require a Commission decision. Whereas, at present, all complaints must be acted on, regardless of the interest of the complainant, it is intended that henceforth complainants would have to show that they were interested parties within the meaning of the Procedural Regulation. Complaints from other persons would merely be treated as information tools. The Commission also is seeking to introduce new powers for gathering market information from sector participants.

What Determines the Design of Bank Loan Contracts? A New Channel

I investigate whether uncertainties in bankruptcy procedures shape fi nancial contracting in the U.S. syndicated loan market. Utilizing a novel hand-collected data set, I exploit the application of substantive consolidation procedure, which is probably the most debated issue in U.S. bankruptcy courts. This procedure has two unique features: i) banks have unexpectedly large losses on their unsecured loans since in the court rooms the existing seniorities are removed, resulting in billion dollar allocation changes between the creditor groups; ii) since there is no specifi c provision in the U.S. Code, there is consensus in the law literature that this procedure has no theoretical background and its application is highly unpredictable. I conclude that after exposure, banks write more secured credit and tighter covenants in their new loans to other firms, even after controlling for bank capitalization, borrower and time fixed e ffects. To my knowledge, this is the fi rst paper to show that uncertainties in the bankruptcy procedures provide an important friction in the loan market. Moreover, my work complements the previous literature by providing a new channel for the determinants of optimal financial contracts. Results of this paper are also important for policy makers, who want to ease bank lending standards.

Deimante Ltd.: Case study for introductory auditing course

Abstract This case study is designed for undergraduate or postgraduate students in introductory auditing courses to critically apply their auditing knowledge and judgement as they work through the various stages of an audit process. The audit approach in the case study, which is consistent with international standards on auditing, is divided into four phases: 1. requires students to evaluate the client’s business and assess key business risks, 2. enables students to set materiality levels and make a combined risk assessment of significant accounts likely to be materially misstated, 3. allows students to respond to the combined risk assessment of the significant accounts identified by developing relevant substantive procedures, 4. involves students undertaking the following wrap-up procedures: • evaluate the findings from the substantive procedures, • prepare a summary of audit differences, and • determine the impact of misstatements on the audit opinion. The case is also designed to aid students in developing their research and communication skills while working in a team setting.

The analytical review procedures in audit: an exploratory study

This study investigates the relationship between the audit objective and the choice of substantive procedures used to ensure the satisfaction of the auditor. The research that gave support to the current study is exploratory and adopted a non-probabilistic sample comprising 28 auditors of an Undergraduate and Master’s degree programs in Accounting of a Brazilian University. Thus, to preserve the maturity and skill expected of the respondents of the research we restricted a minimum of one year of auditing experience for the auditor that might have served in one of the Big Four Auditing firm. Methodology wise, we applied a qualitative ordinal approach and the research question is as follows: What are the characteristics of Analytical Review Procedures that guide auditors’ judgment while choosing among a mix of procedures to meet the requirements of the substantive tests? Our analysis was based on absolute frequency analysis of the use of the substantive procedures. In this respect, our results revealed that auditor’s satisfaction is anchored on the materiality of the accounts or group of accounts to be audited. Yet they give a relative importance to judgment of risk and relevance of misstatement that each account presents. In so doing, auditors give preference to substantive procedures in which one is able to gather information from third parties to confirm accounting balances while giving less priority to recalculation of routine tests developed by the audited entities.

En-Gender-ing Legal Reforms: Islamic Law in Africa and East Asia

Women have been an integral part of the particular form of revolution that has erupted across the Arab world since early 2011. As part of their participation, women have articulated concrete demands for reform that reflect their aspirations for gender equality. Knowledge and understanding of existing circumstances are essential for meaningful and lasting change. Thus, this article attempts to bring to light the relationship between gender equality and Islamic law in various contexts, by comparing the cases of Malaysia, Nigeria, Tunisia and Egypt, both in terms of the legal reforms implemented at the national level, as well as the practical reality of women’s lived experiences. Specific attention is given to existing substantive law, normative frameworks, institutions, procedures and enforcement and how all of these elements affect gender relations.

An empirical investigation of the use of ISA 520 “analytical procedures” among Big 4 versus non‐Big 4 audit firms in Egypt

PurposeThis study aims to examine the International Standards on Auditing (ISA) number 520 relating to analytical procedures (APs) and adapt relevant aspects of prior studies on APs to the Egyptian audit context. The study investigates the extent of use of APs in Egypt during the three main stages of an audit by size of firms and level of staff. It examines auditors' perceptions of the frequency and effectiveness of different types of APs in achieving a selected set of audit objectives. The study also identifies the types of assurance provided by APs and their influence on detailed testing as well as analyzing the role of auditing standards in the context of the use of APs.Design/methodology/approachThe design and research method are empirical using a questionnaire survey to collect information on actual uses of APs from 14 audit firms in Egypt which audit the 100 actively traded companies on the Egyptian Stock Exchange (EGX) as measured by the EGX 100 index. The survey was carried out between 2008 and 2009.FindingsThe results of the study showed relatively low use of APs by Egyptian auditors with wide variations in its use by Big 4 and other auditing firms. Auditors from Big 4 firms are found to use APs to a greater extent than auditors from non‐Big 4 firms. Also, the reliance on APs tends to differ by auditors rank and position. The majority of auditors consider APs useful in achieving audit objectives. Audit firms of all size continue to emphasize judgment‐based compared to quantitatively based procedures. The results also indicated a lack of confidence in the use of APs as substantive procedures. Finally, the study confirmed prior research findings in that auditing standards are regarded as most effective in codifying existing large firms practice. It was found that ISA 520 has been least effective in stimulating change in the Egyptian audit practice.Research limitations/implicationsThe different economic, political, educational, and culture environment in Egypt may restrict the generalisability of this study results.Practical implicationsIn order to increase the use of APs by Egyptian auditors in the various stages of the audit engagement, auditors need to understand the requirements of the Egyptian Auditing Standards regarding their use. Auditors also need to be aware of the application of various APs techniques, especially those associated with statistics and mathematical models. Educational institutions and the Egyptian Association of Accountants and Auditors must play significant role in educating auditors about APs techniques and their use in planning, testing and final review of the financial statements.Originality/valueThis paper contributes to an understanding of the nature and uses of APs within the Egyptian culture and economic context. The study will stimulate further research in understanding the importance of the use of APs in audit engagements in different perspectives.

How Does Engagement Risk and PCAOB Regulatory Actions Influence Auditors’ Internal Audit Reliance Decisions?

This paper examines how external auditors’ reliance decisions on the internal audit function (IAF) are affected by two Public Company Accounting Oversight Board (PCAOB) regulatory actions (the risk-based audit approach required by auditing standards and a change in the focus of the PCAOB inspection process) and engagement risk. As predicted, we find a significant interaction between these three factors that shows the following. First, when the riskiness of the audit tests is low, the effect of focus of the PCAOB inspection process is not significant on the auditors’ reliance on the IAF when engagement risk is low. However, when engagement risk is high, the auditors placed significantly greater reliance on the IAF when a balanced focus is used for the PCAOB inspection process compared to an effectiveness focus. Second, when the riskiness of the tests to be performed is high, the auditors relied more on the IAF in the balanced focus of the PCAOB inspection process condition regardless of the level of engagement risk. Lastly, we find that under the new regulatory regime external auditors rely more on the IAF to perform tests of controls than substantive procedures.

South African students’ perceptions of the usefulness of an audit simulation

The South African Institute of Chartered Accountants and the International Federation of Accountants require Information Technology (IT) to be integrated with the professional subjects, including Auditing, qualified chartered accountants need. Internationally, people want changes to Auditing teaching. The Accounting Department of Stellenbosch University developed an audit simulation of the whole audit process from client acceptance to completion. Students must prepare working papers, using substantive procedures focusing on stock and a database large enough for students to use IT. The simulation’s learning objectives are integrating auditing with IT, and exposing students to as authentic an audit as possible. A questionnaire tested students’ perceptions on the simulation. Responses were favourable. Respondents felt that the simulation helped them to understand auditing and showed them the practical application of IT functionalities. However, respondents complained that the simulation took too long. The principles and findings apply to simulations and the use of case studies in any environment.

Is Audit Quality Associated with Auditor Tenure, Industry Expertise, and Fees? Evidence from PCAOB Opinions

This study examines the link between deficiencies documented in the inspection reports of the PCAOB and several auditor attributes - tenure, industry expertise, and fees paid to the auditors. We examine two types of deficiencies or negative opinions: an audit deficiency, such as failure to perform and document sufficient substantive procedures and a serious deficiency such as failure to detect a departure from GAAP that could (if material) result in a restatement of the financial statements. We find that auditor tenure and industry expertise mitigate both types of deficiencies for non-Big 4 auditors. It appears that auditor's industry expertise is more important than auditor tenure for mitigating deficiencies. We also find that auditor's city-level expertise has incremental power for audit quality over nation-level expertise in mitigating both types of deficiencies. Abnormal audit fees and total fees are associated with audit deficiencies and serious deficiencies. Further, the interaction of abnormal audit fees and tenure increases the likelihood of serious deficiencies. The findings have implications for audit firms, clients, investors, regulators, and others.

The Relationship between Writing Knowledge and Writing Performance among More and Less Skilled Writers

One ingredient that may serve as a catalyst for writing development is changes in writing knowledge. This study assessed the veracity of two tenets underlying this proposal: that skilled writers are more knowledgeable than less skilled writers, and that individual differences in knowledge are related to writing performance. Both of these assumptions were supported. First, fourth-grade students who were more skilled writers were more knowledgeable than their less skilled peers. They knew more about how writing promoted school and later occupational success. They also were more knowledgeable about the role of substantive processes in composing, the use of substantive procedures when writing for a younger child, and the value of seeking assistance when experiencing difficulties. Second, for more skilled writers, writing knowledge was significantly correlated with their story writing performance.

The House of Lords and the Northern Ireland Conflict - A Sequel

This article begins by commenting on an analysis undertaken by the late Stephen Livingstone of 13 cases relating to the troubles in Northern Ireland decided by the House of Lords between 1969 and 1993. It then attempts to repeat the analysis in respect of 12 such cases decided between 1994 and 2005. Areas of law arising for consideration during both periods include the rules on the use of lethal force, aspects of substantive criminal law and criminal procedure and the rights of persons arrested or imprisoned. The more recent cases also raise fundamental questions concerning the status and meaning of the Good Friday Agreement of 1998. The article concludes that there has been a sea-change in the way the Law Lords have handled the Northern Irish cases. From treating them in a way which might have suggested a built-in bias in favour of police, army and government perspectives, they have moved to analysing the competing arguments in the light of more modern approaches to statutory interpretation, the rule of law and human rights.