Use Of Analytical Procedures Research Articles

The Auditor’s Responsibility is to Apply the Concept of Materiality in Accordance with the Standard (ISA.320) in Determining Analytical Audit Procedures to Reduce Audit Risks

The research aims to clarify the auditor’s responsibility for applying the concept of materiality in accordance with the (ISA.320) standard in determining the analytical audit procedures represented by the process of assessing audit risks. To achieve the research aims, the descriptive analytical approach was used to deal with data collection and classification. The main study tool, represented by the questionnaire form, was used to collect data from the study sample, which was analyzed through the SPSS program. The questionnaire was distributed to a number of sample members, and the number was suitable for conducting statistical analysis, as it reached 45 questionnaires, of which 40 questionnaires were suitable for analysis. The most important conclusions were that there is a statistically significant effect of the auditor’s analytical procedures when applying the International Auditing Standard Materiality (ISA.320) in assessing audit risks. The study recommended the need for the Accounting and Auditing Council to take measures to verify the compliance of Iraqi audit offices with audit risk assessment procedures through the use of analytical procedures by the auditor in accordance with International Auditing Standard 320 Materiality

ECONOMIC AND ANALYTICAL BASIS OF DIGITAL TRANSFORMATION OF ADMINISTRATION PROCESSES IN CONSTRUCTION ENTERPRISES

An effective management system at an enterprise should be built on the use of optimal tools. Data Science is one of the ways to optimize the management system of a business entity through the use of analytical procedures that will help to obtain high-quality and timely information content to prevent risks in the internal business environment. Analytical tools allow identifying problematic aspects of the company's activities, assessing the impact of factors and developing ways to eliminate the negative impact of factors with further development of a development strategy. Interpretation of the results of the analysis of activities using predictive analytics helps to improve the efficiency of the management system at the enterprise. The conceptual foundations of updating business processes and management systems for a construction enterprise on the basis of digitalization (digital administration) are substantiated, which are positioned as a means for the enterprise to achieve competitive advantages in the multi-project field of construction development. Analytical IT tools should be applied to a sufficient amount of qualitative and operational information, which will allow for effective integration of research results into the management process at an enterprise. The article is devoted to solving an urgent scientific and applied problem of developing theoretical foundations and methodology, which includes information models, methods, cognitive mechanisms that allow for the analysis, selection, optimization, and evaluation of the effectiveness of the introduction of modern concepts of information modeling and integrated implementation of a construction project.

Why Auditors Increasingly Rely on Analytical Procedures: An Empirical Approach in Portugal

Purpose: The study aims to reflect on the reasons behind the increasing use of analytical procedures during evidence collection as a way of corroborating the claims made in financial statements. Theoretical framework: The study develops the problem arising from more complex financial information due to more complex transactions within market players, and develops all the theoretical approach to auditing and the analytical procedures ruled in ISA 520. Design/methodology/approach: A relevant sample was taken from the auditing market in Portugal, and thus principal component analysis was develop in order to conclude why auditors tend to rely increasingly in analytical procedures, as a source of evidence in auditing approaches. Findings: The conclusions of this empirical study point to the fact that, in general terms, the increasing use of analytical procedures stems from a risk-based approach to auditing together with reasons that have to do with time pressure and the need to carry out more efficient audits with fewer substantive detail tests as well as improvements in the interpretation of norms applicable to auditing work. Research, Practical & Social implications: Comprehensive conclusions identify the increasing usage and confidence on analytical procedures by auditors, pointing out objective reasons the justify that fact. Originality/value: There are several investigations about risk based approach in auditing, but no actual study was found that explores the reasons behind the increasing usage of such procedures, within the International Standards on Auditing (ISA’s). The study thus provides evidence about reliability and relevance of such procedures.

Institutional approaches to internal audit in agricultural organisations

Substantiation. The internal audit system is an integral part of business management in agribusiness organisations. It allows to identify deficiencies, improve processes and increase the quality of agricultural products. Objective. The purpose of the study is the formation of an institutional approach to the implementation of internal audit of agro- industrial organisations The work is theoretical in nature and aims to develop methodological approaches of internal audit of the organisation. Materials and methods. The study predetermines the study of the regulatory and legal framework, as well as a review of the opinions of different authors on the problems of internal audit. The methodological basis of the study was the methods of analysis, induction, deduction, abstraction in the organisations of agro-industrial complex. Results. In terms of the institutional approach, awareness about the internal audit system requires an assessment of the interrelationships between the so-called “institutions” of the agro-industrial complex organisation. The relationship between them is determined by a set of institutional mechanisms that determine the way the system functions. In this context such institutional mechanisms as ensuring the independence of internal auditors, the use of analytical procedures at different stages of internal audit, as well as the use of risk-oriented approach are considered. The article considers the peculiarities of planning and conducting internal audit. The main stages of internal audit of agro-industrial complex are formed.

ASSESSMENT OF THE FINANCIAL SECURITY OF A COMPANY WITH STATE PARTICIPATION

An assessment of the economic, including financial, security of an organization plays an indispensable role in making managerial decisions that affect the process of formation and development of regional and national markets for goods, works and services. The economic security of an organization has rather unstable development trends, so analysts tend to describe options for ensuring it not only for short-term prospects for the development of production, but also to look further a year or several years ahead. The use of analytical procedures in assessing the level of financial security helps specialists to analyze indicators of economic security, and the manager to coordinate the activities of the organization, orienting production to improve indicators in places where financial risks are most affected.
 The subject of research in the article is the process of assessing the financial security of an organization with state participation using analytical audit procedures. The study discusses the author's approach to assessing financial security, which allows you to identify areas of damage to financial security and focus on areas of increased risk. The research methodology is based on the application of general scientific methods of analysis, such as the synthesis of the obtained data, comparison and others, as well as specific analytical procedures.

Biomonitoring of pesticides in urine by using isoamyl acetate as a sustainable extraction solvent

The protection of the health and safety of workers in the agricultural sector requires the assessment of human exposure to pesticides through biomonitoring programs. In doing this, the health and safety of laboratory analysts should be also protected through the use of analytical procedures as safe as possible. According to Green Analytical Chemistry and Green Sample Preparation principles, the use of miniaturized extraction techniques such as dispersive liquid-liquid microextraction (DLLME) should be encouraged, with the aim of limiting the consumption of chemicals (solvents and reagents) and energy, as well as the production of wastes. Moreover, safer and more environmentally friendly alternatives to petroleum-derived solvents must be found. In this regard, the effort of researchers is focused on the development/identification of sustainable solvents, some of which have been ranked according to their disposal, environmental, safety, and health features.Here, we introduce the alternative use of isoamyl acetate (“banana oil”) as sustainable extraction solvent. Compared with the trendy class of eutectic solvents (ESs), isoamyl acetate is advantageous because it is already in the liquid state, which fasters operations, and because it can be evaporated to dryness and reconstituted in a solvent compatible with the mobile chromatographic phase, which is not an option for ESs. The applicability of isoamyl acetate has been here evaluated for the first time to extract 12 pesticides of different polarities from urine matrix, by using a DLLME approach. The HPLC/MS validated method has proven to possess the sensitivity, precision and accuracy required to reliable bioanalytical methods. Its cheapness, simplicity and quickness make it an ideal sustainable choice for the screening of large numbers of samples in health monitoring programs involving people occupationally-exposed to pesticides.

Characterization of Inclusion Size Distributions in Steel Wire Rods.

The control of inclusions in steel components is essential to guarantee strong performance. The reliable characterization of inclusion populations is essential not only to evaluate the quality of the components but also to allow the use of analytical procedures for the comparison and discrimination of inclusion populations. In this work, inclusion size distributions in wire rod specimens from six plant-scale heats were measured and analyzed. For the measurements, the metallographic procedure specified in the ASTM E2283 standard was used. The population density function (PDF) approach and the extreme value statistical procedure specified in the ASTM E2283 standard were used to analyze the whole size distribution and the upper tail of the size distribution, respectively. The PDF approach allowed us to identify differences among inclusion size distributions and showed that new inclusions were not formed after the liquid steel treatment process. The extreme value statistical procedure led to the prediction of the maximum inclusion length for each heat, which was used for the statistical discrimination of heats. Furthermore, the estimation of the probability of finding an inclusion larger than a given inclusion size using the extreme value theory allowed us to order the heats for different critical inclusion sizes.

New Trends in the Quality Control of Enantiomeric Drugs: Quality by Design-Compliant Development of Chiral Capillary Electrophoresis Methods.

Capillary electrophoresis (CE) is a potent method for analyzing chiral substances and is commonly used in the enantioseparation and chiral purity control of pharmaceuticals from different matrices. The adoption of Quality by Design (QbD) concepts in analytical method development, optimization and validation is a widespread trend observed in various analytical approaches including chiral CE. The application of Analytical QbD (AQbD) leads to the development of analytical methods based on sound science combined with risk management, and to a well understood process clarifying the influence of method parameters on the analytical output. The Design of Experiments (DoE) method employing chemometric tools is an essential part of QbD-based method development, allowing for the simultaneous evaluation of experimental parameters as well as their interaction. In 2022 the International Council for Harmonization (ICH) released two draft guidelines (ICH Q14 and ICH Q2(R2)) that are intended to encourage more robust analytical procedures. The ICH Q14 guideline intends to harmonize the scientific approaches for analytical procedures’ development, while the Q2(R2) document covers the validation principles for the use of analytical procedures including the recent applications that require multivariate statistical analyses. The aim of this review is to provide an overview of the new prospects for chiral CE method development applied for the enantiomeric purity control of pharmaceuticals using AQbD principles. The review also provides an overview of recent research (2012–2022) on the applicability of CE methods in chiral drug impurity profiling.

Accounting and analytical support for managing the reliability of financial reporting indicators

The factors contributing to the violation of the current legislation on accounting and reporting, which lead to distortion of the reporting of financial and property status in the reporting, have been clarified. The purpose of the entity, the subject and objects of the audit to identify signs of falsification of financial statements. It is substantiated that analytical procedures allow establishing the absence or presence of deviations between the actual and expected values of indicators disclosed in the financial statements. It has been proven that the use of analytical procedures in the audit may confirm the reliability of financial statements or identify atypical deviations that may be highly likely to indicate fraudulent actions during the documentation of major business processes and distortion of interrelated financial statements. It is established that modern approaches to the audit methodology to verify the reliability of financial statements are based mainly on the use of documentary and factual methods of control, analytical procedures are limited to horizontal and vertical analysis, rapid analysis of financial condition, based on correlation-regression analysis. The classification of analytical procedures according to the information base and according to the complexity of the methodology has been developed. The article presents the typical violations that can be identified during the audit to identify signs of falsification of financial statements using analytical procedures.

The Effect of Auditors' Use of Analytical Procedures in the Light of ISA 520 on Audit Quality: Evidence from Jordan

This study aims to demonstrate the effect of auditors' use of analytical procedures in the light of audit standard 520 (ISA 520) on the audit quality from the point of view of external auditors in Jordan. Moreover, the study sought to make valuable recommendations to develop audit methods and address weaknesses to take advantage of financial analysis methods. To achieve the objectives of the study, questionnaire was developed included (35) questions distributed to a sample of auditors practitioners of the audit profession and numbered (64) auditors, have been recovered, (60) of them were collected, and all of them, were used in analysis; One sample t-test was used to test the hypotheses of the study. the researcher found: There is a statistically significant impact of auditors' use of analytical procedures on the quality of audit for both: the auditor 's use of financial ratios and the comparing financial ratios and extracted information with predetermined standards (financial analysis standards), also there are no statistically significant differences on the impact of auditors' use of analytical procedures on the quality of audit attributable to personal variables (educational qualification, specialization, duration of service). Finally, researchers Finally, the researcher made some recommendations to develop the audit process, the most important of them: The supervisory authorities shall ensure that Audit offices and auditors should comply with international auditing standards in general and in the field of analytical procedures based on the International Auditing Standard (520), as well as Standard No. (220) on Quality Auditing in particular. and professional standards and meet the wishes of users of financial statements to achieve quality control and be subject to peer review.

INTERNAL CONTROL IN THE SECURITY SYSTEM OF A CORPORATE ORGANIZATION (ON THE EXAMPLE OF JSC «MINUDOBRENIYA»)

Introduction. The functioning of corporate organizations in a changing business environment puts forward requirements for improving the management processes of an economic entity, and above all, the transformation of its functions in the field of forecasting, planning, regulation, accounting. The increasing role of control functions is due to the need to regularly monitor and analyze the state of business processes of an economic entity, the formation of a unified infor-mation base of economic analysis for making management decisions in the field of strengthen-ing the economic security of the corporation. Objectives. Development of provisions for or-ganizational and methodological support of internal control of commercial organizations to improve the quality of their control activities and the effectiveness of the functioning of the corporate organization as a whole in the conditions of business continuity and strengthening of external threats to the business environment. Methods. The theoretical basis for writing the article was the use of general scientific methods of cognition as an analysis, a systematic ap-proach to the processes and phenomena studied in the article, and detailing. To interpret the obtained research results, we used a logical approach, deductions and induction, comparison, summaries and groupings, analytical procedures and other methods. Results. The systematiza-tion of existing approaches to the disclosure of the essence of internal control is carried out, the description of the object of research is given on the basis of an integrated approach, which made it possible to justify the ways of organizing the internal control system of a corporate or-ganization in order to ensure a high level of security of its activities. The scheme of interaction of the internal control department with other structural divisions of the corporate organization and interested parties is presented, which made it possible to determine the place of the internal control system in the management system of the corporate organization. Conclusions. The pro-posed model of interaction of internal control subjects developed on the basis of the data of the corporate organization of JSC "Minudobreniya", the developed recommendations for improv-ing its functioning in accordance with the interpretation of the results of the use of analytical procedures indicate the need to integrate the use of control procedures in all business processes of the corporate organization, a clear distribution of job responsibilities and responsibilities of business process participants for improving the efficiency of implementing control recommen-dations into corporate governance practice and constant monitoring of the implementation of control procedures, which will increase the level of economic security of the corporation.

The use of analytical procedures in audit of procurement of goods, works, and services

Subject. The more intensive use of the Unified Information System in Procurement data helps evaluate the reliability of statistical reports in procurement of goods, works, and services and ensures the efficiency of the procurement process. Used for auditing, analytical procedures allow to analyze the feasibility of procurement, make some quantification, and apply informal methods by identifying the specifics of basic provisions of statistical reports. Objectives. We investigate the use of analytical procedures in procurement audit so as to evaluate the existing procurement situation of a business entity, possible solutions and development paths, and determine the corruption risk indicators in procurement. Methods. The study relies upon methods of trend, structural and coefficient analysis, comparison, grouping, methods for systematization, analytical processing of economic data and presentation of findings. Results. We justify the use of analytical procedures in audit as they are supposed to provide users of statistical reports with relevant information to explain their administrative decisions on procurement management. The verification of statistical reporting data can be hampered with, for example, the coefficient method, since it focuses on the correlation of the expected bona fide competition level, which has been attained, and the effective standards in regulatory documents on the contractual system. Conclusions and Relevance. As part of procurement audit, analytical procedures may apply to the deviation from target and previous indicators. Scrutinizing causes of such deviation, it is possible to evaluate the dynamics of procurement in the long time horizon and the reliability of statistical reporting.

The use of analytical procedures at the audit planning stage

The article considers the main stages of an audit. They allow to achieve the main goal of audit planning, that is, the implementation of a reporting test to identify possible errors; reporting testing for probable errors; horizontal and vertical analysis and "reading" of reports; express analysis of reporting. At the stage of planning the audit, after the disclosure of inconsistencies in the forms of financial statements, significant changes in the dynamics and structure, it is possible to determine the coefficients and at the same time the method of express analysis of the statements is used. The article focuses on the main mistakes in financial reporting. The main ratios for the analysis of financial statements are also given: liquidity ratios; financial stability; turnover; profitability. The analytical procedures presented in the article, which are guided by auditors at the stage of planning an audit, can be divided into the following groups. In addition, the division of audit procedures helps to identify problems in the provided information in a timely manner when disclosing it in the financial statements, and is aimed at identifying audit risks at the substantive stage. The use of analytical procedures at the stage of planning an audit allows you to create an audit program with minimal time costs, reduce the risks of problems that are associated with a lack of time and skills of personnel.

Audit risk calibration

AS5[v.Dec:2017] issued by the Public Company Accounting Oversight Board [PCAOB] requires the use of Analytical Procedures [AP] at the Planning and Substantive Phases of Assurance Audits for firms traded on active exchanges. We argue that one aspect of AP, relative to risk-setting, should be vetting the information that is produced/published by the audit client pertaining to Regulation G [v.SEC:2003] called: Non-GAAP information. In our research, we intend to leverage the longstanding Reg[G] requirements to extend the Non-GAAP information to firm performance profiles reported for the Environment, Social, and Governance[ESG]Platform on BloombergÒ. There are two research foci: (1) Offer an AP-Model that uses GAAP & ESG variables to contribute audit evidence useful in making the decision to launch an AP-Extended Procedures examination of the firm’s Enterprise Resource Planning & Control [ERP&C] protocols, and (2) Profile a random accrual-set of firms indexed on Bloomberg so as to offer population parameter estimates for refining the AP-Model. The AP-Model is based upon correlational associations for the ESG- & GAAP-variables from the: Income, Balance Sheet & Cash Flow Statements. If there seems to be a disconnect between the nature of these associations for the ESG-variables and those of the GAAP-variables, the auditor may use this as audit evidence in making the decision to conduct an Extended Procedures Examination of the firm’s [ERP&C] protocols. As for the other focus, we found that for the accrual of firms tested there is no inferential evidence that the ERP&C-protocols are consistent drivers for both the ESG- and the GAAP variable sets.

Applying analytical procedures for performance audit of customs authorities

Subject. The article considers the development of a set of methods and indicators of economic analysis, which can be used for performance audit of customs authorities, using the Volga Customs Administration case. Objectives. The aim is to justify the use of analytical procedures to rank the effectiveness of customs payments for the purpose of performance audit of customs authorities. Methods. We employ general scientific methods of research, i.e. dialectical and monographic methods, logical analysis, comparison, as well as the Euclidean distance method. Results. We reviewed works by Russian and foreign scholars on the history of customs audit development and internal financial control of customs authorities, gave scientific credence to attributing the system of customs payment and performance to the indicators of economic activity of customs authorities. Due to the lack of methods for assessing the performance of customs authorities, the use of analytical procedures during the performance audit seems to be a promising area. Conclusions. When verifying the scientific hypothesis put forward in the study, we established that the introduction and development of the ranking system for the performance of customs authorities related to the collection of customs duties can contribute to effective financial audit of customs authorities in general.

Особенности применения аналитических процедур в аудите финансового состояния

Особенности применения аналитических процедур в аудите финансового состояния

ANALYTICAL PROCEDURES OF AUDITING WITHIN THE FRAMEWORK OF RAISING STANDARDS FOR ITS QUALITY CONTROL

. Under the current conditions of economic development, it is important for owners and shareholders to obtain an independent expert assessment of the effectiveness of the entity’s business. In connection with this, there is a need for wider application of analytical procedures in the audit. In the article the essence, levels and types of analytical procedures of audit are examined, peculiarities of application of analytical procedures during audit in the current conditions of development of the economy of Ukraine are determined. The necessity of improvement of analytical procedures of audit in conditions of increase of requirements to control its quality is substantiated. The shortcomings of estimation of financial stability of the enterprise are determined. In addition, the financial stability of the entity is determined by comparing the actual and optimal values (criteria) of the respective coefficients. The criteria used in programs are generalized and do not take into account the industry and the specifics of the enterprise. Such an assessment of financial stability in many cases does not actually reflect the actual situation on the subject of management. This is due to the fact that the majority of relative indicators of financial stability are determined by the ratio of own and attracted capital, while not taking into account their structure and peculiarities of formation. In addition, the financial stability of an entity is determined by comparing the actual and optimal values (criteria) of the respective coefficients. The criteria used in these programs are generalized and do not take into account the industry and the specifics of the entity’s activities. When applying modern information technology in the audit, we must carefully approach the choice of software products and the final interpretation of the results. In the article proposes a refined and expanded list of optimal values (criteria) of indicators of financial stability, taking into account the specifics of different branches of the national economy. An auditor in assessing the financial sustainability of a business entity — the customer, it is also advisable to take into account the features of his activity and, depending on this, adjust the criteria. To improve the quality of the audit, the use of analytical procedures should be adequate to the objectives and objectives of the audit, and the costs of their conduct should be correlated with the results obtained.

A Vetting Protocol for the Analytical Procedures Platform for the AP-Phase of PCAOB Audits

Study Context AS5[2017], issued by the Public Company Accounting Oversight Board, requires the use of Analytical Procedures [AP] at the Planning and Substantive Phases of Assurance Audits of firms traded on active exchanges. Logically, an aspect of this requirement is satisfied by using a Panel of the Client’s data at the Planning Phase to forecast the Client’s YE-closing values and then at the Substantive Phase to dispose the directional difference between the: [Actual Client’s YE-value and the AP-Forecasted YE-value]—the Disposition Phase. Research Focus To date, neither the PCAOB nor the AICPA have suggested a pilot-test paradigm to vet the AP-forecasting Protocol under consideration. To address this lacuna, we detail an AP: Decision Support System [AP:DSS] that offers to the Audit InCharge a two-stage pre-analysis AP-vetting [Pilot-Test] platform that employs False Negative [FN] and False Positive [FP] Profilers. In inferential analyses, the FP-Risk is usually benchmarked using the FN-Risk. Deliverables A comprehensive AP-vetting model is offered and illustrated using: (i) a preliminary estimator of a reasonable sample size, (ii) two Standard Forecasting Models: The Excel versions of the OLS Linear Two-parameter and the Moving Average Models, and (iii) a Benchmarking protocol. Unique in this AP:DSS vetting protocol is that the FP-risk is contexted by the FN-risk from the independent benchmark domain. This duality enhances the inferential impact of the vetting protocol as it uses separate variable sets. The AP:DSS is available at no cost as an e-Download.

On the Program of Research on the Attitude of the Population to the Work of the Power and Administrative Vertical in the Regions with Different Levels of Sociocultural Modernization

This article is a part of the comprehensive research of the Center of Sociology of Management and Social Technologies of IS RAS of authority-society relations on the basis of the theory of civil contract from methodological positions of management sociology. This is a description of the transition to the empirical stage of fundamental research work. The article substantiates the elements of the program of research on the attitude of the regions’ population to the work of the links in the authority-administrative vertical in the conditions of essential distinctions between the regions by level of their social and cultural modernization. On this basis, the problems of its reform and research are formulated. In the most general terms, we view the social problem of the civil contract as a very significant contradiction between the high level of support of the population for the foreign policy of the country’s leadership, in view of the obvious attempts of Western countries, and especially the USA, to depreciate the role of Russia in the world arena, and significantly lower assessments of citizens’ achievements in domestic politics. This difference is reflected in the critical attitude of a significant part of the population to the ability of the authority and administrative vertical, in particular its territorial bodies, to successfully solve the problems of socio-economic development of specific territories. The article substantiates the division of regions into levels of development, formulates social and scientific problems of research, and traditionally singles out the object, subject, hypotheses and methods of their empirical testing. Special attention is paid to the use of the so-called triangulation method (Zh. T. Toshchenko), from the standpoint of which both methods of mass and expert surveys and methods of content analysis of pro-governmental and “opposition” media, as well as methods of analysis of big data based on online content are used on the same data set. Triangulation is the consistent use of analytical procedures to produce complementary empirical data.

Analytical procedures in external auditing: A comprehensive literature survey and framework for external audit analytics

There is an increasing recognition in the public audit profession that the emergence of big data as well as the growing use of business analytics by audit clients has brought new opportunities and challenges. That is, should more complex business analytics beyond the customary analytical procedures be used in the engagement and if so, where? Which techniques appear to be most promising? This paper starts the process of addressing these questions by examining extant external audit research. 301 papers are identified that discuss some use of analytical procedures in the public audit engagement. These papers are then categorized by technique, engagement phase, and other attributes to facilitate understanding. This analysis of the literature is categorized into an External Audit Analytics (EAA) framework, the objective of which is to identify gaps, to provide motivation for new research, and to classify and outline the main topics addressed in this literature. Specifically, this synthesis organizes audit research, thereby offering guidelines regarding possible future research about approaches for more complex and data driven analytics in the engagement.