Business Commons^™

Effect Of Black- Or White-Sounding Name And Impact Of Intergroup Contact With Black Individuals On Auditor Judgments, Vanessa J. Tijerina

Doctor of Business Administration (DBA)

The accounting profession in the United States continues to reflect a gap in racial diversity, with the majority of accountants being white. Implicit racial bias results in discrimination in the U.S. today, specifically against Black individuals. Within accounting, the auditing specialty requires exercising professional judgment that could present opportunities for implicit racial bias to affect the financial statements. This study aims to fill gaps in the existing research by answering the following questions: 1) How does the race of the CFO affect the accounting judgments of auditors? 2) How does intergroup contact with Black individuals impact auditors’ accounting judgments when …

Audit Firm Executives Under Pressure: A Discursive Analysis Of Legitimisation And Resistance To Reform, Michael Harber, Warren Maroun, Alan Duboisee De Ricquebourg

Business Papers and Journal Articles

The UK audit profession is facing a crisis of public trust and legitimacy following a series of high-profile audit failures. This resulted in the executive leadership of UK audit firms being summoned before a House of Commons Select Committee as part of its inquiry into ‘the future of audit’. During this inquiry the audit executives walked a tightrope, to both defend the social contract from an existential threat and attempt to influence policy reforms in their favour. This paper draws on ‘neutralisation techniques’ from deviance theory and the ‘grammar of legitimation’ from legitimacy theory to inform a discursive analysis of …

Audit Adjustments Matter: What They Reveal About Companies' Financial Reporting, Themin Suwardy, Chu Yeong Lim

Research Collection School Of Accountancy

This study investigates the characteristics, nature and extent of proposed audit adjustments to the financial statements of listed companies in Singapore. Data was gathered from the 2018 to 2020 financial statements of 412 companies, along with views of close to 280 audit committee chairs and heads of finance (or similar designations) on the effectiveness of their companies’ finance function.

Could Sox Be Better? : Exploring The Advantages And Shortfalls Of Sarbanes-Oxley, Christopher Clark

Honors Theses

The Sarbanes-Oxley Act was ratified in 2002 to mixed reviews. Over the past 18 years, many researchers have come to different conclusions about the effectiveness of SOX. This paper proposes amendments to make SOX as effective as possible without increasing compliance costs and as cost effective as possible without decreasing efficacy.

Business Risk And Attest Service Fees: Understanding The Effect Of Low Fed Interest Rates On Bank Audit Fees, Lucas Erik Jones

Honors Theses and Capstones

No abstract provided.

The Effect Of The Covid-19 Pandemic On The Issuance Of Going Concern Opinions And Financial Restatements, Jessica Oswald

Honors Theses and Capstones

No abstract provided.

Audit Quality Implications Of Regulatory Change In South Africa, Harina Ndaba, Michael Harber, Warren Maroun

Business Papers and Journal Articles

Purpose: This paper explores how technical constructions of audit practice are influenced by mandatory audit firm rotation (MAFR) regulations. The paper responds to calls for additional research on how external regulation influences audit quality and supplements the predominately quantitative research dealing specifically with firm rotation and its relevance for audit quality.

Design/methodology/approach: Data are collected from South Africa which is the latest jurisdiction to adopt MAFR (from 2017). Detailed interviews with 49 participants comprising 24 audit partners and 25 non-auditors are conducted to explore how MAFR can impact audit quality. For this purpose, audit quality is defined according …

أثر حوكمة الشركات على جودة التدقيق في الاردن - The Effect Of Corporate Governance On Audit Quality In Jordan, Medhat Bsoul

Al Jinan الجنان

This study was conducted to investigate the effect of corporate governance on the audit quality in Jordan. this study is applied on service company listed on Amman Stock Exchange for the year 2010, which constitute of (68) public service companies. To achieve study objective, the information from annual reports of these companies was used, as many independent variables as (existence of an audit committee in the company, the number of members of non-executives in the Board of Directors of the company, total assets, the company›s life, and the debt ratio) used as measure of corporate governance. And the proportion of …

Auditor Information Spillovers And Company Operating Performance: Evidence From Targeted Auditor Switches, Tyler Kleppe

Graduate Theses and Dissertations

In this study, I examine whether companies realize operational benefits from making “targeted auditor switches” (i.e., engaging a new auditor recently dismissed by a competitor company). While prior work provides evidence consistent with companies perceiving that auditor information spillovers are costly, there is sparse extant evidence as to whether auditors actually do transfer operational information across companies. I find that companies that switch to a competitor’s former auditor realize significant subsequent improvements in operating performance, and I provide evidence that the association between targeted auditor switches and improvements in operating performance varies predictably with several across- and within-market factors. In …

The Evolution Of The Auditor And Auditing Profession: The Impact Of The Sarbanes-Oxley Act Of 2002, Kylie Pollack, Scott Delanty

Honors Thesis

The Sarbanes-Oxley Act of 2002 (SOX) was arguably the most influential piece of legislation passed to affect the accounting profession. Over the past nearly two decades since SOX was enacted, the auditor and auditing profession has evolved. The public’s perceptions of auditors and the profession have improved as a result of major legislation such as the Sarbanes-Oxley Act of 2002. This paper explores the evolution of the auditor and audit profession over the course of three different time periods to understand the function of the auditor. This paper is broken down into four major components. First, this paper explores what …

Internal Audit Policy Statement, American Institute Of Certified Public Accountants. Internal Audit Division, Jerry Cicalese

Guides, Handbooks and Manuals

No abstract provided.

The Balanced Scorecard: Measures That Drive Performance Evaluation In Auditing Firms, Mohamed Hegazy, Karim Hegazy, Mohamed Eldeeb

All Works

© The Author(s) 2020. The purpose of this article is to establish a framework with its related measures for the development of a balanced scorecard (BSC) for auditing firms. A BSC was developed providing the detailed measures for performance evaluation comprising five key elements: learning and growth, clients, internal business processes, financials, and audit-related perspectives of corporate ethics. A survey was undertaken along with descriptive statistics and confirmatory factor analysis in four auditing firms, to assess the external auditors’ opinions for the proposed BSC measures. The results suggest that the development and use of the proposed BSC measures will enhance …

Auditor Perceptions Of Audit Workloads, Audit Quality, And Job Satisfaction, Julie Persellin, J. Schmidt, S. D. Vandervelde, Michael S. Wilkins

School of Business Faculty Research

In this study, we use a survey instrument to obtain perspectives from over 700 auditors about present-day audit workloads and the relationship between audit workloads, audit quality, and job satisfaction. Our findings indicate that auditors are working, on average, five hours per week above the threshold at which they believe audit quality begins to deteriorate and often 20 hours above this threshold at the peak of busy season. Survey respondents perceive deadlines and staffing shortages as two of the primary reasons for high workloads and further believe that high workloads result in decreased audit quality via compromised audit procedures (including …

Data Analytics In An Audit: Examining Fraud Risk And Audit Quality, Sondra Smith

Doctor of Business Administration Dissertations

ABSTRACT

DATA ANALYTICS IN AN AUDIT: EXAMINING FRAUD RISK AND

AUDIT QUALITY

by

Sondra Smith

This study is comprised of two papers which examine, through interviews and an experiment, the current practices of data analytics of CPA firms, whether and how fraud risk impacts the usage of data analytics in an audit, and the effect data analytics has on the efficiency and effectiveness of an audit. The implementation of data analytics in an audit is relatively new, and there is not a good understanding of how it is currently being used in practice. Although historically the auditing profession has been …

Association Of Insider Trading Patterns With Earnings Management Citations From 2002-2012, Anne-Mary Emuobonuvie Nash-Haruna

Walden Dissertations and Doctoral Studies

Insider trading and earnings management (EM) have traditionally been associated with fraud and corporate scandals. Corporations involved in fraudulent financial reporting or earnings manipulations were assumed to have used insider trading patterns to manipulate earnings, thereby concealing information from investors. The purpose of this quantitative, non-experimental study was to examine the association between insider trading patterns and EM citations among a randomly selected sample of publicly traded companies. The research question pertained to the association between the number of EM citations and whether a firm exhibited patterns of insider trading among publicly traded firms. The theoretical framework was based on …

Blockchain And The Future Of The Audit, Connor Ortman

CMC Senior Theses

“In the future, virtually every function in the world of financial services will be displaced, disintermediated and decentralized. The Internet gave us a powerful way to share and access information. Blockchain now gives us a powerful way to share and access value.”

During a February 2017 AICPA roundtable, Chairman of the Wall Street Blockchain Alliance and previous Global Head of Trading Analytics at Thomson Reuters, Ron Quarantana spoke to the revolutionary scale of blockchain. Quaranta, viewed by many as an expert in financial technology, predicts that the adoption of blockchain, both by the Big Four accounting firms and their clients, …

Analytical Procedures, October 1, 2017; Audit Guide, American Institute Of Certified Public Accountants (Aicpa)

Industry Guides (AAGs), Risk Alerts, and Checklists

No abstract provided.

The Expanded Auditor's Report: A Case Study From The United Kingdom, Maria Jones

Senior Honors Projects, 2010-2019

This paper examines whether or not the Public Company Accounting Oversight Board should adopt new standards similar to those recently adopted in the United Kingdom by performing a qualitative analysis of the information provided in the expanded auditor’s reports of four major UK grocery store chains both prior to and after the adoption of the new standard. In my analysis I find that the external auditor is frequently reporting on key audit matters and risks that are already being reported by management, and therefore already known to investors, suggesting little to no added value in the expanded auditor’s report.

Quo Vadis Accounting And Auditing In Turkey, Necdet Saglam

Journal of Global Business Insights

The main purpose of the research was to illustrate the history of accounting and auditing in Turkey. It is found that auditing has evolved through a number of stages. Current status of accounting and auditing profession in Turkey has been examined in this study. Recent issues and applications with regard to the statutory audits in Turkey has examined in detail. Related problems and solutions will also be discussed from a broad perspective of the professional standards.

Audit Regulation In An International Setting: Testing The Impact Of Religion, Culture, Market Factors, And Legal Code On National Regulatory Efforts, Gary Kleinman, Beixin Lin

Department of Accounting and Finance Faculty Scholarship and Creative Works

Assuring the quality of international auditing is important in the current, globalized business/economic environment. High-quality international auditing efforts promote greater confidence in financial statements, and therefore promote greater movement of capital. Ensuring high-quality auditing efforts is the task of auditing regulation efforts, among others. Several potential determinants of the strength of these efforts were postulated in Kleinman et al (2014). The postulated determinants of interest include national culture, religion, legal code origin, and financial market liquidity. The authors, however, did not test the relationship of the postulated determinants to auditing enforcement efforts. This study undertakes the task of investigating such …

The Influence Of Cognitive Factors On The Relationship Between Accounting Standard Precision And Aggressive Financial Reporting, Kara E. Hunter

2017

The U.S. SEC has formally advocated for the creation of a single set of global accounting standards. As the SEC considers converging U.S. GAAP with IFRS, there is heightened interest in how the precision of accounting standard influences the quality of the financial reporting process. My dissertation consists of three studies that seek to address how accounting standard precision interacts with different behavioral factors to influence aggressive financial reporting decisions and auditor judgment. Paper one presents evidence of a significant interactive effect of standard precision and preparer incentive horizon. Specifically, we find evidence that when the incentive horizon is long …

Managing Informal Learning In The Auditing Profession: How Auditors Develop Proficiency, Michelle Kusaila

Walden Dissertations and Doctoral Studies

The auditing environment is in a period of innovation, and auditors need to maintain their financial reporting commitment to financial statement stakeholders. The purpose of this quantitative cross-sectional survey study was to examine the impact of auditors' perceptions of informal workplace learning contexts on the external auditing profession using a perceived organizational support lens. Organization support theory includes four aspects used to explore informal workplace learning: management support, peer support, supportive organizational culture, and access to work resources. These aspects were used to examine the impact of informal learning on auditors' engagement and performance. Multiple linear regression was used to …

Governance Interactions In Sustainable Supply Chain Management, Errol Meidinger

Transnational Business Governance Interactions Working Papers

“Supply chains” are a major site of transnational business governance, and yet their dynamics and effectiveness are usually more assumed than interrogated in regulatory governance discourse. The very term “chain” implies a more determinist and simplistic understanding of supply relationships than is empirically supportable. Supply chains in practice are complex, dynamic, and highly variable networks. Based on peer-group presentations by over 60 supply chain professionals, this paper analyzes sustainable supply chain management practices in terms of the interactions conceptions of the Transnational Business Governance Interactions framework. It discusses possible refinements of the framework and suggests that sustainable supply chain management …

Demand For And Assessment Of Audit Quality In The Market For Private Capital: A Field Study, Shyam Sunder, Adam Esplin, Karim Jamal

Shyam Sunder

No abstract provided.

The Accounting Court: Some Speculations On Why Not?, Gary Kleinman, Pamela Strickland, Asokan Anandarajan

Department of Accounting and Finance Faculty Scholarship and Creative Works

The accounting court proposed by Spacek (Account Rev 33(3):368, 1958) was a potent and controversial idea. The court would provide a venue to which auditing firms and clients could bring disputes over the application of accounting principles and over time would build a database of casework illustrating the court’s decisions on proper application and interpretation of accounting principles. In this paper, we contribute to the literature on the accounting court and on standard setting by analyzing group value orientations and motivations that should promote the likelihood of an accounting court appearing in these times. We base our analysis in value …

Audit Firm Rotation, Audit Firm Tenure, And Audit Committee Support In Accounting Disputes, Janice E. Rummell

Doctor of Business Administration Dissertations

Since the late 1990s, U.S. regulators have sought to increase auditors’ independence from management and to reduce the presumed detrimental effects of economic bonding on public company financial reporting. Implementation of mandatory audit firm rotation that limits auditor tenure to reduce potential independence impairment has been discussed in the U.S. and other jurisdictions, and adopted in some non-U.S. jurisdictions. While audit firm rotation is expected to increase auditor independence, the opponents of mandatory rotation cite decreasing auditor expertise as a significant counter-argument. This independence/expertise trade-off is integral to much of the academic discussion of mandatory audit firm rotation. The audit …

Audit Committee Effectiveness: A Synthesis Of The Empirical Audit Committee Literature, F. Todd Dezoort, Dana R. Hermanson, Deborah S. Archambeault, Scott A. Reed

Deborah Archambeault

The article describes the factors that contribute to audit committee effectiveness. An effective audit committee has qualified members with the authority and resources to protect stakeholder interests by ensuring reliable financial reporting, internal controls, and risk management through its diligent oversight efforts. The determinants of audit committee effectiveness includes the audit committee composition, authority, resources and diligence. The major U.S. stock exchanges require that audit committees be composed of at least three independent, financially literate directors. Team issues also are relevant when considering audit committee composition. The audit committee derives its authority from the full board of directors, federal law …

Securing Big Data Provenance For Auditors The Big Data Provenance Black Box As Reliable Evidence, Deniz Appelbaum

Department of Accounting and Finance Faculty Scholarship and Creative Works

The purpose of this article is to highlight a main issue regarding reliable audit evidence derived from Big Data—that of secure data provenance. Traditionally, audit evidence external to the client has been regarded as superior to other forms of evidence. However, regarding external “messy” Big Data sources that may be material to aspects of the audit, these sources may lack provenance and verifiability. That is, the origins of the data may be unclear and its log files incomplete. According to the standards, such evidence should be considered as less reliable for audit evidence. External auditors, as outsiders of the client, …

Ipo Firms' Voluntary Compliance With Sox 404 As Evidence On The Value Relevance Of Internal Control Quality, Qianyun Huang, Kimberly Gleason, Leonard Rosenthal, Deborah Smith

Business Faculty Publications

Newly public firms are not required to comply with SOX 404 for their initial public offerings. This provides a unique setting in which to investigate the benefits of voluntary disclosure with SOX 404 and the value of information revealed as a consequence of compliance. We investigate whether voluntary compliance with SOX 404, either fully or partially, impacts the perceived risk of firms conducting IPOs on the first day of trading (reflected in underpricing) or following the IPO. Our results indicate that neither full compliance with SOX 404 at the time of the IPO, nor a managerial discussion of internal controls …

The Effect Of Hypothesis Framing, Prior Expectation And Professional Trait Scepticism On Experts’ And Novices’ Evidence Selected In A Complex Task, Abhijit Das

Theses: Doctorates and Masters

This study examines evidence selection strategy among external auditors (i.e. professionals) and accounting students (i.e. novices) in a going concern assessment task considering three factors; hypothesis framing, prior expectation and professional “trait” scepticism as measured by Hurtt (2010) scale. Within this context, the study sets out to accomplish three goals: (1) to re-examine evidence selection strategy based on hypothesis framing and prior expectation, (2) to validate the Hurtt (2010) scale using expert reviews and confirmatory factor analysis and (3) to investigate whether professional trait scepticism influences selection strategy.

Owing to the incidence of high-profile accounting and auditing scandals worldwide, the …