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Journal articles on the topic 'External audit'
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1
Abbott, Lawrence J., Susan Parker, and Gary F. Peters. "Internal Audit Assistance and External Audit Timeliness." AUDITING: A Journal of Practice & Theory 31, no. 4 (November 1, 2012): 3–20. http://dx.doi.org/10.2308/ajpt-10296.
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SUMMARY Professional standards guide external auditors to consider the effect of the client's internal audit work and opportunities to utilize the direct assistance of the internal audit function when planning and conducting audits. We examine the effect of internal audit assistance on external audit timeliness via the extent of external audit delay. We hypothesize and find that internal audit assistance is negatively associated with external audit delay. We also document moderating relationships between internal audit assistance and other internal audit environment characteristics, such as the extent of internal control reliance, coordination with the external auditor, and the investment in internal audit quality. Overall, our findings have implications for firms and external auditors who are evaluating the role and use of internal audit functions. Namely, our findings suggest that internal audit assistance may not only result in audit cost savings, but also in greater audit efficiencies. These findings are particularly germane given the challenges faced by external auditors in the form of greater audit requirements, shorter regulatory filing deadlines, resource constraints, and audit fee pressures.
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Huseyin, Cicek, and Dikmen Suleyman. "EXTERNAL AUDIT AND FISCAL TRANSPARENCY: AN EMPIRICAL ANALYSIS." Public Administration Issues, no. 5 (2021): 7–26. http://dx.doi.org/10.17323/1999-5431-2021-0-5-7-26.
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The aim of this study is to examine the socio-economic, institutional, and political factors affecting external audit, with the use of an international comparison. In addition, the effect of external audit on fiscal transparency was analyzed. Although many empirical studies in the literature handle the factors affecting fiscal transparency, there are only a few empirical studies that focus on the factors affecting external audit and the impact of external audits on fiscal transparency. However, there is not one study dealing with the factors affecting external audit through making use of international comparisons. In this study we attempt to discover the factors affecting external audit and examine, using an international comparison, the impact of external audits on fiscal transparency. The Open Budget Survey published by the International Budget Partnership in 2017 was used to measure external audits. In the study, consisting of 115 countries, the effect of democratization level, government debt level, government balance, gross domestic product (GDP) per capita, legislative budget oversight, the SAI's audit diversity and the effect of a judicial model of the SAI on external audit were investigated. The effect of external audit on fiscal transparency is tested for 115 countries using the Two-Stage Least Squares Method (2SLS). According to the analysis, it is determined that the level of democratization, gross domestic product (GDP) per capita, budget oversight of the legislature, audit diversity of supreme audit institution and judicial model of supreme audit institution have significant and positive effects on external audit. It is also determined that external audit has a significant and positive effect on fiscal transparency.
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Heo, Jin Suk, and Eun Sun Ki. "Association between Detailed Disclosure on External Audit Execution and Audit Quality." Korean Accounting Review 42, no. 6 (December 31, 2017): 195–224. http://dx.doi.org/10.24056/kar.2017.12.002.
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Stoica, Petrica. "EXTERNAL AUDIT SYSTEMS." STUDIES AND SCIENTIFIC RESEARCHES. ECONOMICS EDITION, no. 13 (December 17, 2008): 98. http://dx.doi.org/10.29358/sceco.v0i13.30.
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The present article has as objective the presentation of a series of external audit systems, together with some of their characteristics and models found in different countries. The purpose of the external audit performed by the Supreme Audit Institutions (SAI) is to assure the proper use of the public funds, a good management and the public and private accountability of the authorities, through the published objective rapports.
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Hatherly, David J. "External examining: An external audit service?" British Accounting Review 20, no. 1 (April 1988): 21–37. http://dx.doi.org/10.1016/0890-8389(88)90111-4.
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Aulia, Devira Yolla. "Impact of Audit Committee Expertise on Earnings Management and External Auditor Moderation." ATESTASI : Jurnal Ilmiah Akuntansi 4, no. 2 (July 9, 2021): 190–203. http://dx.doi.org/10.33096/atestasi.v4i2.809.
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Audit committees and external audits have a very important role for financial reporting and the tendency of corporate managers to manipulate earnings. Frequency is a key factor in reducing conflicts of interest and opportunistic behavior from managers. This study aims to examine the effect of the audit committee's financial expertise on earnings management with external auditors as moderation. In this study, there were 1,966 company data listed on the Indonesia Stock Exchange in 2016-2019. Earnings management variables, audit committee financial expertise, and external audit were analyzed using multiple linear regression models. The results showed that the financial expertise of the audit committee had a significant positive effect on earnings management. Audit committee expertise moderated by external audit has a negative and significant effect on earnings management.
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KHERSIAT, Ola Mohammad. "The Impact of Audit Committees on the Realization of an Integration Relationship between Internal and External Audit when Conducting Audits. A Study on Public Shareholding Corporations." Journal of Advanced Research in Law and Economics 11, no. 2 (March 31, 2020): 420. http://dx.doi.org/10.14505/jarle.v11.2(48).15.
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This study aims to investigate methods of achieving an integrating relationship between internal and external audit when conducting audit procedures in Jordanian public shareholding corporations, as well as investigate the impact of audit committees achieving such a relationship since an effective internal audit effective the external auditor`s estimations regarding control risks. The study concludes that all aspects of the realization of an integration relation between internal and external audit have achieved a fair ratio exceeding 60%. Spearman test was used to show the nature of the relationship between the internal and external audit. The test results showed that the relationship between these methods is vulnerable in Jordanian public shareholding corporations, and that audit committees have no statistically significant impact on achieving an integrating relationship between internal and external audits in conducting audit in Jordanian public shareholding corporations, since the ratio of audit committees interpretation (R2) which amounted to (.145) of the dependent variable difference ( achieving an integrating relationship between internal and external audit in conducting audit) is relatively low, and that the P- value derived for this relation amounted to (.615) which is more than (5%) .
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Maama, Haruna, and Ferina Marimuthu. "Accountability in the Ghanaian local governance structure: probing the role of external auditing." Problems and Perspectives in Management 18, no. 4 (December 25, 2020): 475–85. http://dx.doi.org/10.21511/ppm.18(4).2020.38.
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The roles of external auditors have been under the spotlight due to the strategic positions they occupy to ensure accountability by public sector managers. This study examines the role of the external auditors in the accountability regime of the Ghanaian local governance structure. The study analyzed the annual reports of the Auditor General (AG) on all the metropolitan, municipal, and district assemblies (MMDAs) in Ghana from 2010 to 2018 through a content analysis method. The analysis revealed that Ghanaian audit activities had mainly focused on internal control effectiveness, cash management, contract management, revenue management, expenditure management, payroll management, and procurement management. However, the study found that the focus of the external auditors kept expanding as the years progressed. The evidence showed that the auditors excluded performance audits in their scope of work. The findings of the study further revealed that the MMDAs had recurring, repetitive, and common audit queries, comprising cash; procurement and stores; contract and tax irregularities. Besides, the audit recommendations were in response to the specific audit queries on the various financial and operational irregularities. Based on the analysis, the study concludes that the external auditing in Ghana has marginally contributed to accountability in the MMDAs. The study recommends that the scope of the external audit should include performance auditing.
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Brandon, Duane M. "External Auditor Evaluations of Outsourced Internal Auditors." AUDITING: A Journal of Practice & Theory 29, no. 2 (November 1, 2010): 159–73. http://dx.doi.org/10.2308/aud.2010.29.2.159.
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SUMMARY: In the last decade internal auditing services has been a significant area of growth for public accounting firms. Unlike the provision of external audits, the provision of outsourced internal audit services does not prohibit accounting firms from providing the client with additional services. This study investigates some implications of an outsourced internal auditor providing nonaudit services. Specifically, 89 experienced external auditors completed an experiment to investigate whether external auditors will evaluate and rely on an outsourced internal auditor’s work differently when the internal auditor also provides nonaudit services. Results indicate that evaluations of the outsourced internal auditors’ objectivity were negatively affected by the provision of nonaudit services. Further, the differences in objectivity perceptions are tempered by the use of different personnel to provide consulting services. Competence perceptions were not affected. Results also indicate that external auditor reliance on internal audit and suggested audit fees are affected. However, these results do not appear to be tempered by audit and nonaudit staffing decisions.
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Nazarova, Karina. "INSTITUTIONALS BASES OF SYNERGY OF INTERNAL AND EXTERNAL AUDIT." International Journal of New Economics and Social Sciences 1, no. 1 (June 30, 2015): 0. http://dx.doi.org/10.5604/01.3001.0010.4708.
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The article presents the results of a study on institutional support synergy of internal and external audit. We consider the legal field of internal and external audits, indicated its shortcomings and ways to improve it. Presented the argument of the need for synergy of internal and external audit in connection with the selected Ukraine by European integration.
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Lee, Ho-Young, and Hyun-Young Park. "Characteristics of the internal audit and external audit hours: evidence from S. Korea." Managerial Auditing Journal 31, no. 6/7 (June 6, 2016): 629–54. http://dx.doi.org/10.1108/maj-05-2015-1193.
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Purpose Using 5,055 sample firm-years in Korea between 2009 and 2013, this paper aims to examine the association between the characteristics of the internal audit and the number of external audit hours as a proxy for audit efficiency. Design/methodology/approach This study is motivated by the International Standard on Auditing No. 610: “Using the work of internal auditors”. This auditing standard guides external auditors in using the work of internal auditors to obtain audit evidence and consult internal auditors for direct assistance. The authors expect that external audit efficiency will increase when the work of competent internal auditors is used. Findings The authors find that the number of internal auditors relative to the number of employees is associated with the number of external audit hours. This result suggests that the greater the availability of internal auditors, the greater their contribution will be to the financial statement audit and the more efficient the audit. The authors find evidence that external auditors use the work of internal auditors with accounting and legal expertise to improve audit efficiency. They also find some evidence that the work of internal auditors with greater availability is more effective during initial external audit engagements. Originality/value This study adds to the extant literature on the contributions of internal auditors to external audits by using archival data and by measuring audit effort using a large database of audit hours. In addition, our findings have practical implications for firms and external auditors who are evaluating the role and value of using the work of internal auditors. The authors also believe that the findings will be of interest to regulators or auditing standards boards.
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Pizzini, Mina, Shu Lin, and Douglas E. Ziegenfuss. "The Impact of Internal Audit Function Quality and Contribution on Audit Delay." AUDITING: A Journal of Practice & Theory 34, no. 1 (June 1, 2014): 25–58. http://dx.doi.org/10.2308/ajpt-50848.
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SUMMARY The number of days required to complete financial statement audits (i.e., audit delay) increased significantly with the implementation of Section 404 of the Sarbanes-Oxley Act (SOX, U.S. House of Representatives 2002). As firms' in-house experts on internal control, Internal Audit Functions (IAFs) can substantially affect financial reporting processes and, thus, audit delay. Internal auditors can help management maintain strong internal controls and assist external auditors with financial statement audits. Accordingly, we investigate whether IAF quality and the IAF's contribution to financial statement audits affect audit delay in a sample of 292 firm-year observations drawn from the pre-SOX 404 period. Using survey data from the Institute of Internal Auditors (IIA), we develop a comprehensive proxy for IAF quality; we measure different aspects of IAF quality (e.g., competence, objectivity, fieldwork rigor); and we measure the nature of the IAF's contribution to financial statement audits (independently performed work and direct assistance). Results indicate audit delay is decreasing in IAF quality, and this decrease is driven by IAF competence and fieldwork quality. Delay is four days shorter when IAFs contribute to external audits by independently performing relevant work. High-quality IAFs contribute to financial statement audits by independently performing relevant work, while low-quality IAFs provide direct assistance.
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Setiawan, Santy, Yenni Carolina, and Aura Kristiani. "THE EFFECT OF AUDITOR’S COMPETENCE AND INDEPENDENCE ON INFORMATION SYSTEM AUDIT QUALITY." Asia Pacific Fraud Journal 5, no. 2 (December 30, 2020): 183. http://dx.doi.org/10.21532/apfjournal.v5i2.155.
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Users of financial statements always rely on the results of audits conducted by competent andindependent auditors because the audits are carried out through quality processes and efforts. Competent and independent auditors are needed to obtain quality audit results. Because most modern information systems use information technology, the information technology audits become an important component in all external and internal audits. This study aims to examine the effect of auditor’s competence and auditor’s independence on the information systems audit quality. The research sample used in this study is external auditors working in public accounting firms in West Java. The statistical test instrument used is a multiple regression test. The results show that the auditor's competence has an effect on information systems audit quality, while the auditor’s independence has no effect on information systems audit quality.
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Tiruneh, Dawit Tadesse. "PERSPECTIVE OF CORPORATE GOVERNANCE ON THE INTERACTIONS OF INTERNAL AUDIT WITH MANAGMENT AND ITS IMPACT ON THE INTERNAL - EXTERNAL AUDIT LINKAGES." Copernican Journal of Finance & Accounting 10, no. 3 (September 25, 2021): 51–70. http://dx.doi.org/10.12775/cjfa.2021.011.
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Literatures based on developed countries suggest an interaction of internal audit with management has impact on the internal-external audit linkages and the interactions and linkages have their own contribution toward the realization of good corporate governance. Nevertheless, these interactions have not been sufficiently explored in developing countries such as Ethiopia. This quantitative research examines in the form of explanatory study the interaction of internal audit with management and its impact on the internal- external audit linkages in Ethiopia. By doing so, it explained the causal relationship between variables through hypothesis testing. The research method of this study was a constructed questionnaire, which was sent to companies and to the 100 top management, internal auditors, and external auditors in Ethiopia. As it has been examined, existing findings suggest that organizations can enhance corporate governance’s effectiveness by strengthening the interactions of internal audit with management and in the meantime as the result of this impact by upgrading the internal-external audit linkages. In line with this, the results indicate interactions of internal audit with management depend on the level of the result of internal audits’ effectiveness, as the result, it positively moderates the internal-external audit linkages.
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Kassem, Rasha, and Andrew W. Higson. "External Auditors and Corporate Corruption: Implications for External Audit Regulators." Current Issues in Auditing 10, no. 1 (January 1, 2016): P1—P10. http://dx.doi.org/10.2308/ciia-51391.
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SUMMARY The purpose of the current study is to examine the responsibility of external auditors in relation to corporate corruption and to highlight the implications of this for external audit regulators. The current study is based on a critical review of prior academic literature as well as a thorough examination of both the International and American Auditing Standards relating to fraud and illegal acts. External auditors have a responsibility for assessing corruption risks but their role was not clearly defined by external audit regulators. The current study was the first to clarify the responsibility of external auditors with regards to corporate corruption, and to shed light on current limitations in the audit standards related to this area. The current study also offers recommendations to audit regulators, external auditors, audit firms, and researchers on such controversial area.
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Ismail, Hashanah. "Corporate governance, external audit and the audit process." Corporate Ownership and Control 6, no. 4 (2009): 309–16. http://dx.doi.org/10.22495/cocv6i4c2p5.
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This paper reports on interviews with audit partners of listed companies on their perspectives of impact of corporate governance on the audit process. Based on responses received the study finds that audit risk framework is dynamic enough to incorporate expected changes in control environment brought about by greater consciousness on the part of directors on the need for good internal control. However there is still skepticism that good governance practice has filtered through clients’ control environment as auditors believe dominant CEO’s may still moderate the effectiveness of audit committees
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Cumbe, Luís Leonardo, and Helena Inácio. "The impact of external audit on the accountability of the common fund of the Mozambique National Institute of Statistics." Managerial Auditing Journal 33, no. 6/7 (June 4, 2018): 538–57. http://dx.doi.org/10.1108/maj-01-2017-1500.
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PurposeThe purpose of this paper is to evaluate the impact of external audit on the management of the Common Fund of the Mozambique National Institute of Statistics (INE).Design/methodology/approachThis paper followed a case study approach of the INE Common Fund that was based on the qualitative evidence from the content analysis of the external audit reports, annual plans of activities and budget for the past seven years and interviews with middle managers of the INE.FindingsThe research found that external audit has a relatively significant impact on the management of the INE Common Fund. The authors attribute the positive impact to the high concern of management to implement the external audit recommendations, associated with the financial dependence between the agent (the National Institute of Statistics) and the principal (Fund Donors), explained through Laughlin’s Model of Accountability.Practical implicationsThe results indicate that external audit associated with the financial dependence of the agent on the principal has a significant impact on the accountability. Thus, it contributes to assist in the formulation of public policies on external financing to developing countries.Originality/valueMost of the studies on external audit and accountability are from countries with more developed economies than Mozambique’s, without heavy reliance on external financing, and these studies analyse the audits carried out by public audit institutions. This research explores the phenomenon in the context of external financing to the State Budget by governments and international organisations.
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Mustafin, A. "Audit and Consulting Market Analysis. Prospects and Opportunities." Scientific Research and Development. Economics of the Firm 9, no. 3 (October 7, 2020): 49–58. http://dx.doi.org/10.12737/2306-627x-2020-49-58.
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This article is devoted to the audit and consulting market, their capabilities, prospects and opportunities. This article discusses the classification of audits for internal, external and consulting. The analysis of the external audit market is based on the data of the Ministry of Finance website for the period from 2014 to 2018.
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Goodwin-Stewart, Jenny, and Pamela Kent. "Relation between external audit fees, audit committee characteristics and internal audit." Accounting and Finance 46, no. 3 (September 2006): 387–404. http://dx.doi.org/10.1111/j.1467-629x.2006.00174.x.
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Banbhan, Ashfaque Ali, Khalid Hussain Abbasi, and Farheen Qasim Nizamani. "The Relationship between CEO Characteristics & External Auditing Quality: A Longitudinal Assessment." Global Economics Review IV, no. IV (December 30, 2019): 141–56. http://dx.doi.org/10.31703/ger.2019(iv-iv).13.
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All publicly-traded companies are required by law to disclose their accurate financial information in order to reduce information asymmetries. This study focuses quantitatively on the impact of top management on the quality of corporate audits. Using company financial data, this study found that there is a positive correlation between highquality audits and company performance, as a higher quality audit can ensure rigorous follow-up to financial reports. This study also broadens the understanding of a higher-level manager in the presence of a quality audit.
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lulian, Dobra. "External Audit In Nhs Trusts." Annales Universitatis Apulensis Series Oeconomica 1, no. 10 (June 30, 2008): 411–15. http://dx.doi.org/10.29302/oeconomica.2008.10.1.45.
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Glazebrook, Susan GM, and J. G. Buchanan. "Clinical governance and external audit." Journal of Quality In Clinical Practice 21, no. 1-2 (March 2001): 30–33. http://dx.doi.org/10.1046/j.1440-1762.2001.00390.x.
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Kumari, S., K. Upadhyay, and L. Blake. "Audit of external cephalic version." Archives of Disease in Childhood - Fetal and Neonatal Edition 95, Supplement 1 (June 1, 2010): Fa29. http://dx.doi.org/10.1136/adc.2010.189746.61.
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Glazebrook, Susan GM, and J. G. Buchanan. "Clinical governance and external audit." Journal of Quality in Clinical Practice 21, no. 1-2 (June 28, 2008): 30–33. http://dx.doi.org/10.1111/j.1440-1762.2001.00390.pp.x.
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Cenciarelli, Velia Gabriella, Giulio Greco, and Marco Allegrini. "External audit and bankruptcy prediction." Journal of Management and Governance 22, no. 4 (February 26, 2018): 863–90. http://dx.doi.org/10.1007/s10997-018-9406-z.
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Sharafutdinov, A. A., and A. V. Krasnov. "Fire Safety External Audit Procedure." IOP Conference Series: Earth and Environmental Science 666, no. 5 (March 1, 2021): 052011. http://dx.doi.org/10.1088/1755-1315/666/5/052011.
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Ko, Mi-Hyun, Dong-Wuk Kim, and Sang-Yum Kang. "External Audit Evasion Behavior of Limited Companies Following the Revision of External Audit Standards." Korean Accounting Information Association 21, no. 3 (September 30, 2021): 1–25. http://dx.doi.org/10.29189/kaiajfai.21.3.1.
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Spitsyna, N. V., and S. V. Kravtsova. "Internal Audit: Approaches to Definition, Differences from External Audit." Business Inform 5, no. 508 (2020): 342–48. http://dx.doi.org/10.32983/2222-4459-2020-5-342-348.
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Prasad, Nishaal, David Hay, and Li Chen. "Internal audit use, earnings quality and external audit fees." Pacific Accounting Review 33, no. 4 (July 30, 2021): 474–504. http://dx.doi.org/10.1108/par-04-2020-0050.
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Purpose The purpose of this study is to examine the effect of internal audit function (IAF) use on earnings quality and external audit fees using empirical data collected from the New Zealand (NZ) setting. Design/methodology/approach Applying institutional theory as the underlying framework, this study examines an IAF’s ability to demonstrate legitimacy, which will shed light to the functions long-term survival. Using a unique data set from the NZ setting, which combines information obtained from “The Institute of Internal Auditors of New Zealand” with empirical firm data collected from publicly available sources, multivariate analysis is performed to test the prediction that IAF use is associated with earnings quality, measured using discretionary accruals, and external audit fees. Findings There is strong positive association between IAF use and external audit fees, which supports the complementary controls view, where better internal controls increase audit fees by increasing the demand for scope of external audit work. The authors find no significant relationship between IAF use and earnings quality, which is not entirely surprising. Research limitations/implications The aim is to empirically test the IAF value proposition and to delve deeper into the black box of IAF value drivers. Given the size of the NZ economy and limitations of data availability, total sample size used in this study is relatively modest. However, the analysis does yield significant results. Apart from academic contribution to knowledge, this study offers a profound list of practical contributions. Practitioners will be interested to learn about the IAF value proposition from an empirical viewpoint. Senior management (SM) will obtain value from the outcomes when contemplating IAF investment and sourcing decisions. Regulators will be inherently interested in whether IAFs should be mandated. Originality/value The aim is to empirically test IAF value proposition and to delve deeper into the black box of IAF value drivers. To the best of the authors’ knowledge, this is the first NZ-based academic investigation which examines the relationship between IAF use and earnings quality. Apart from academic contribution to knowledge, this study offers a profound list of practical contributions. Practitioners will be interested to learn about the IAF value proposition from an empirical viewpoint. SM will obtain value from the outcomes when contemplating IAF investment and sourcing decisions. Regulators will be inherently interested in whether IAFs should be mandated.
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Dowling, Carlin. "Appropriate Audit Support System Use: The Influence of Auditor, Audit Team, and Firm Factors." Accounting Review 84, no. 3 (May 1, 2009): 771–810. http://dx.doi.org/10.2308/accr.2009.84.3.771.
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ABSTRACT: I use Adaptive Structuration Theory (DeSanctis and Poole 1994) and the Theory of Planned Behavior (Ajzen 1991) to model the factors influencing whether auditors use audit support systems appropriately. Understanding the factors that influence appropriate use is important for audit firms to achieve efficient and effective audits from deploying audit support systems. Using a unique data set obtained from 569 auditors, I provide evidence that intention to use the system appropriately and external control increase appropriate use. I find that audit support system restrictiveness and the effectiveness of the audit review process are antecedents of external control. Team and firm consensus on appropriation are antecedents of perceived normative pressure, which, along with an auditor's attitude and self-efficacy, influence an auditor's intention to use the system appropriately. The model is relatively stable across different audit support system designs, but differences are evident across the audit team hierarchy.
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Titera, William R. "Updating Audit Standard—Enabling Audit Data Analysis." Journal of Information Systems 27, no. 1 (February 1, 2013): 325–31. http://dx.doi.org/10.2308/isys-50427.
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ABSTRACT This paper highlights the emerging role of data analysis on the financial statement audit and its value throughout the audit process, particularly in providing audit evidence. It raises the issue of needed revisions to the Audit Standards, whether for public or private company audits, and illustrates how certain of the current Audit Standards inhibit the external auditors' use of enhanced data analysis and continuous auditing techniques. While this whitepaper identifies a few audit standards that could be revised in light of current technological capabilities, it does not purport to address all needed revisions. Rather, it recommends that a more in-depth analysis be undertaken to develop needed guidance, as well as a list of recommended changes to the standards.
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Mehmeti, Fatmir. "Common Characteristics and Differences in External and Internal Auditing." European Journal of Economics and Business Studies 10, no. 1 (March 2, 2018): 272. http://dx.doi.org/10.26417/ejes.v10i1.p272-278.
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Many scholars have shown that failure in leading big companies as well as the latest financial crises have led the auditing market to perceive traditional auditing more as a legal requirement rather than as a value added for the company. There are others that do not completely agree to this, but they all accept that the auditing as a profession should accept changes which will affect the value added for the company from auditing. Nowadays the companies are required more accountability rather that it was required before, perversely only financial reports were reported by the companies. Auditing is a process which confirms the statement provided by the company management regarding the information in financial statements that are real and accurate. Auditing has to be based on evidences and logical concept for better understanding. For companies that operate in the market, it is important to provide financial information that is consistent, reliable and complete for all users of the financial statements (banks, potential shareholders and the international community). In daily practice of entities we have two kinds audit, the internal and external audits. Usually, these are interlinked and complementary, with the ultimate aim that the (overall) audit is more effective and the reports that will emerge are fully arguable and meaningful. The internal audit has an important role which is to increase the effectiveness of internal control in private or public company. Internal audit has the responsibility of informing the management of the institution of deficiencies or weaknesses in the internal control system. External auditors are the fist line of the front for companies liadership. They play a key role in verifying the financial information provided to shareholders. External auditors inspect the financial statements prepared by the entity and provide assurance and independent opinion if these statements represent a true and fair view of the entity's condition for the year under review.Keywords: External audits, internal audit, management, financial statement, and independent opinion.
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Iriyadi, Iriyadi. "Prevention of Earnings Management through Audit Committee and Audit Quality in the Award-Winning and Non-Winning Companies." Journal of Accounting Research, Organization and Economics 2, no. 2 (August 31, 2019): 155–69. http://dx.doi.org/10.24815/jaroe.v2i2.14631.
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Objective – The purpose of this study is to determine the role of the audit committee and the quality of external audits on the prevention of earnings management. Design/methodology – The study was conducted using data from 34 winning and non-winning companies for Annual Report Awards (ARA) and Good Corporate Governance (GCG) Awards in 2008-2011, the period of the global economic crisis after the Enron and Worldcom cases in 2002 which triggered the strengthening of the role of the audit committee and external audit. Results – This study found that two important components of the corporate governance structure; audit committee, and external audit, did not affect earnings management. However, by adding the Award control variable, it shows that there is a difference in the effect on earnings management between winners and non-award winners. It suggest that shareholders must continue to strengthen the role of the audit committee and external audit because earnings management is behavior and opportunity for management to deliberately change financial statements that are not easily proven except in very material quantities and over a period of several years. In addition, shareholders, creditors, and regulators should require company management to take part in ARA and GCG Award competitions. Research limitations/implications – The limitation of this study is the small number of samples and the relatively short period of only two years.
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AB WAHID, ROSLINA, and PECK LEONG TAN. "IMPROVING QMS EXTERNAL AUDITORS’ AUDIT PERFORMANCE THROUGH FURTHER EDUCATION, EVALUATION AND CALIBRATION." Quantum Journal of Social Sciences and Humanities 2, no. 6 (November 18, 2021): 14–27. http://dx.doi.org/10.55197/qjssh.v2i6.100.
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Changes in the business environment and the rapid advancement in technology require QMS auditors to be one step ahead in their knowledge and skills. This means they need to be competent to deliver effective audits that add value to their customers. The objective of this study is to investigate whether there is a need to further educate external quality auditors (EQAs) in order to improve their audit performance. A survey questionnaire was utilized in the collection of data from 26 accredited certification bodies (CBs) in Malaysia. The findings of the study show that the majority of respondents felt that there is a need to improve EQAs education to enhance their audit performance. This is supported by the feedback from more than half of the respondents who pointed out that they have received negative comments from their clients on the EQAs’ performance. On certification bodies’ part, to ensure consistent audit performance by auditors, evaluation and calibration of auditors’ competency and performance were carried out. This study highlights the need to improve the audit performance of EQAs through further and wider education based on the feedback on their capability and audit performance that has not been thoroughly studied before.
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Cho, Moon Kyung. "The effects of human resources in internal audit on external audit pricing decision." Corporate Ownership and Control 15, no. 4-1 (2018): 165–80. http://dx.doi.org/10.22495/cocv15i4c1p4.
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This study presents evidence that external audit fees are negatively and significantly associated with the proportion of general internal auditors. Further, external audit hours are negatively and significantly associated with the proportion of general auditors without affecting external unit audit price. In addition, the results of the data adjusted for firm size suggest that audit fees and audit hours decrease for smaller firms as the proportion of general internal auditor increases. The result implies that both small firms and their external auditors are encouraged to utilize more general internal auditors in performing an external audit. The author finds no evidence that external audit fees are associated with internal auditor expertise or experience. This shows that external auditors are not likely to rely on internal auditors’ professional judgment in performing an external audit due to reduced auditor independence.
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Saidin, Siti Zabedah. "Does Reliance on Internal Auditors’ Work Reduced the External Audit Cost and External Audit Work?" Procedia - Social and Behavioral Sciences 164 (December 2014): 641–46. http://dx.doi.org/10.1016/j.sbspro.2014.11.158.
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Sharma, Divesh S., Vineeta D. Sharma, and Barri A. Litt. "Environmental Responsibility, External Assurance, and Firm Valuation." AUDITING: A Journal of Practice & Theory 37, no. 4 (October 1, 2017): 207–33. http://dx.doi.org/10.2308/ajpt-51940.
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SUMMARY We provide new evidence in examining whether external auditors price environmental responsibility initiatives when performing the audit of financial statements. We also examine how investors value the firm when environmental initiatives occur in conjunction with higher audit fees. Results show environmental initiatives are positively associated with audit fees, but the extent of this association varies across the five different types of environmental initiatives we consider. We further find that auditors appear to price environmental initiatives due to their risk rather than additional audit effort. While environmental initiatives may be costly from an audit standpoint, investors value (Tobin's Q) firms more highly when environmental initiatives occur in conjunction with higher audit fees. Collectively, our findings imply that auditors price environmental initiatives into the audit and investors value firms more highly when auditors consider this social responsibility.
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Hegazy, Mohamed, and Hekmat Ebrahim. "Are joint audits associated with higher audit quality?" Corporate Ownership and Control 19, no. 2 (2022): 204–16. http://dx.doi.org/10.22495/cocv19i2art16.
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This paper investigates and assesses whether a joint audit engagement results in higher audit quality compared to a single audit given audit firms’ characteristics and complexity of their clients’ activities. The research adopts a survey-based questionnaire sent to external auditors of five audit firms with international affiliation including two Big 4 firms to assess their perceptions about whether joint audit improves audit quality compared to a single audit. Also, interviews with audit partners and professors of auditing were made to check the reliability of the survey. Descriptive and inferential statistics are used to test the research hypotheses. The results reveal that joint audit enhances the quality of the audit as auditors in joint audits deliver high audit quality and ensure continuity with the client. The results also confirm the importance to perform joint audit engagements involving one of the Big 4 with one audit partner possessing industry specialization related to the audit engagement. However, no variation was found in audit quality in a joint audit compared to a single audit for listed companies compared to non listed companies even when there are discrepancies in the joint audit partners’ level of competence and experience. The study is among the first to survey the impact of joint audits compared to single audits on audit quality in an emerging economy. The study identifies valuable insights and provides recommendations to audit firms, professional and oversight bodies, and government to encourage the use of joint audits versus single audits to improve audit quality
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Alaraji, Fedaa Abd Almajid Sabbar, Zaid Yaseen Saud Al-Dulaimi, Thamer Mahdi Muhamed Sabri, and Elena Iuliana Ion. "Factors affecting the quality of external auditing services." Proceedings of the International Conference on Business Excellence 11, no. 1 (July 1, 2017): 557–68. http://dx.doi.org/10.1515/picbe-2017-0060.
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Abstract This study is aim to adopt knowledge the specific concept to external audit quality and which are the factors that affecting on those qualities in the State of Iraq. As well as, to knowledge the range of depend this job in Iraq on international or local criterion to external audit quality or not. Also, to identify the satisfaction of interested parties about job of audit on service of external audit or not. According to viewpoint external audit the workers in this job and interested parties about external audit in Iraq where practice the profession of external audit under the supervision and control of the board of the profession consists of members appointed by the government ministries no are elected. The study reached to a set of many conclusions, most important of all that the realization external audit in Iraq for importance of external audit quality. Although no existence no concept of specific criterion for quality, whether international or local. Therefore, this study recommends a set of recommendations necessary to adopt uniform criterion for the quality of the external audit job in Iraq, whether international or local, to achieve high quality in audit services and achieving satisfaction of interested parties on those services.
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Shatenok, M. P., A. N. Moiseev, K. V. Tolkachev, S. A. Ryghov, Yu V. Drughinina, and E. N. Sokolov. "Dosimetric Audit for Clinical Linac X-Rays Calibration." Meditsinskaya Fizika 91, no. 3 (October 29, 2021): 102–13. http://dx.doi.org/10.52775/1810-200x-2021-91-3-102-113.
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The CDT guidelines on external dosimetry audit of linear accelerators x-ray beams absolute calibration is described. The guidelines specify audits organization, conduction and results analysis for 4-20 MeV photon beams, including measurement methodology, equipment and staff specification. The guidelines are designed for medical physicists, dosimetrists and management of external beam radiotherapy departments.
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Oussii, Ahmed Atef, and Neila Boulila Taktak. "Audit report timeliness." EuroMed Journal of Business 13, no. 1 (May 8, 2018): 60–74. http://dx.doi.org/10.1108/emjb-10-2016-0026.
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Purpose The purpose of this paper is to examine whether coordination between external auditors and the internal audit function affect the timeliness of audit reports as proxied by audit delay. Design/methodology/approach This study uses a survey of chief internal auditors from Tunisian listed companies to analyze the extent of coordination between IAFs and external auditors. Data spanning a four year period (2011-2014) was collected for 53 listed companies. Further, regression analysis was used to test the hypothesis. Findings Results indicate that greater coordination between internal and external auditors results in timelier financial reporting. Practical implications Overall, the study makes several important contributions. Findings provide important insights that an IAF acts as a valuable resource to external auditors. The results should be of interest to managers, external auditors and the Tunisian Financial Market Council. Originality/value This paper is one of few studies which have examined the association between internal-external audit coordination and timeliness of audit reports in an emerging market. The study makes a meaningful contribution to the corporate governance literature by investigating the influence of internal audit assistance on the delivery of timely audited financial information to the capital market. Results also have policy implications for Tunisian regulators with respect to the promotion of internal auditing best practices.
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Krishnamoorthy, Ganesh. "A Multistage Approach to External Auditors' Evaluation of the Internal Audit Function." AUDITING: A Journal of Practice & Theory 21, no. 1 (March 1, 2002): 95–121. http://dx.doi.org/10.2308/aud.2002.21.1.95.
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External auditors are continually facing intense pressure to be more efficient in conducting audits without compromising quality and effectiveness. Optimal utilization of internal audit work can improve both the efficiency and the effectiveness of external audits and can enhance the value of internal auditors to the client organization. The objective of this study is to understand how the three factors (objectivity, work performance, and competence of the internal auditors) identified by auditing standards and by prior research interact in determining the strength of the internal audit function. Most prior studies have attempted to understand external auditors' rank ordering of the importance of the three factors, without an explicit attempt to model the interactions among the factors. The results from these studies are mixed and inconclusive. Hence, prior studies have not produced a consensus about how external auditors seem to weight and combine these factors in order to make assessments relating to the strength of the internal audit function. This study employs analytical methods based on Bayesian probability to model external auditors' evaluation of the internal audit function. Specifically, models based on multistage (cascaded) inference theory are developed and analyzed using numerical sensitivity analysis. The modeling contribution is significant in the sense that it is the only study that provides a theoretical model for the decision process. Results reveal that the importance of the three factors varies with the type of evidence (convergent or conflicting) observed and is contingent on the interrelationships among the three factors. A major conclusion of this study is that in the Bayesian context, it is futile to attempt a ranking of the factors since no single factor will dominate under all conditions. The study also provides avenues for future research and for improving the guidance provided by professional auditing standards that relate to the evaluation of internal audit work.
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Vujičić - Stefanović, Dragana. "REGULATION OF ASSESSMENT OF THE RISK MANAGEMENT SYSTEM BY EXTERNAL AUDIT IN THE CONTEXT OF FOSTERING MORE EFFICIENT RISK MANAGEMENT - A REVIEW OF THE BANKING SECTOR OF BIH." ЗБОРНИК РАДОВА ЕКОНОМСКОГ ФАКУЛТЕТА У ИСТОЧНОМ САРАЈЕВУ 8, no. 19 (February 10, 2020): 11. http://dx.doi.org/10.7251/zrefis1919011v.
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In this study, regulatory requirements are elaborated regarding external audit in the assessment of the risk management system and the impact of the regulation of risk management system using independent external audit is investigated in the context of encouraging effective risk management in the banking sector of Bosnia and Hercegovina. The research was conducted through a questionnaire, which included a representative sample consisting of all the banks in BiH, within which employees at control functions are included (risk management, internal audit and internal control), along with members of bank boards (Supervisory board, Audit Committee, Bank Management), and relevant external auditors conducting audits in the banks in BiH, as well as professional academic public. The results of the research show a high degree of correlation of the regulation of risk management system by independent auditors and risk management efficiency, but also identify additional mechanisms which encourage more efficient risk management in banks and, consequently, reveal new research areas.
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Leon, Farah Margaretha, and Mario Mario. "Effect of External Audit on The Financial Performance at Indonesian Bank." Indonesian Management and Accounting Research 18, no. 1 (August 28, 2019): 48. http://dx.doi.org/10.25105/imar.v18i1.5385.
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<p>The problem discussed in this study was to investigate the influence of the audit quality on the financial performance of banks listed in the Indonesia Stock Exchange (BEI). The purpose of this study was to examine assumptions of the influence of the quality audit of the financial performance of banks listed on the Indonesia Stock Exchange (BEI). This research analysis method uses linear analysis with a sample size 37 Conventional Banks listed in the Indonesia Stock Exchange (BEI). The results of this study indicate that audit quality has a significant impact on the financial performance of banks. The implication of this study is to investors who use the information as a reference before making the investment that the quality of the external audits will increase the rate of return on investment. While the management of the bank will use the information that the external quality audit will improve the financial performance of banks so as to improve the quality of bank assets and improve the quality of banking assets to reduce <em>non-performing loan</em> (NPL)</p>
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Puryati, Dwi. "Faktor Yang Mempengaruhi Audit Delay." Jurnal Akuntansi Kajian Ilmiah Akuntansi (JAK) 7, no. 2 (August 1, 2020): 200–212. http://dx.doi.org/10.30656/jak.v7i2.2207.
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Company is going public in Indonesia are required to publish their financial reporting that have been audited by an external auditor in accordance with the specified time. However in practice there are still companies that are late in submitting financial reporting. This research aims to examine the effect of tenur audite, audit opinion and size company to audit delay in manufacturing companies listed in Indonesia Stock Exchange on 2015-2017.
The population in this reserch is manufacturing companies listed on the Indonesia Stock Exchange in 2015-2017 with total number of 152 companies. The sample selected by random sampling with the number of samples calculated by the Solvin Formula, and obtained the result of 60 of minimum samples. The data analysis technique used F and t examined. .
The results of the study show that simultaneously tenur audite, audit opinion and company size have a significant effect on audit delay. While partially tenur audite and audit opinion have a significant effect on audit delay, and company size does not significantly effect on audit delay.
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Mandour, Mohamed M., Ali M. Elharidy, and Ekramy S. Mokhtar. "Examining the Effect of Joint and Dual Audits on Earnings Management Practices." International Journal of Accounting and Financial Reporting 8, no. 1 (March 5, 2018): 84. http://dx.doi.org/10.5296/ijafr.v8i1.12526.
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The purpose of the paper is to determine the impact of the voluntary adoption of the joint external audit approach in reducing earnings management practices through accruals and real operations compared with the adoption of the dual external audit approach. The research follows a quantitative approach to collect and analyze data from companies listed on the Egyptian Stock Exchange during the period 2010-2014. 104 firm-year observations are tested in the sample. The findings of the empirical study shows evidence that there are consistent earnings management practices in the studied sample regardless of the type of audit (joint or dual). There is a negative association between joint audit and discretionary accruals compared to dual audit. This means that firms with joint audit are less engaged in accrual earnings management practices. In addition, large firms that adopt joint audit are less engaged in accrual earnings management. However, there is no effect of joint audit on real earnings management practices compared to dual audit. Our results are consistent for firm size, profitability and leverage. Both firm profitability and leverage show positive association with earnings management practices while size did not have a significant effect on either type of practice. Finally, we find that firms with high (low) profitability that adopt joint audits are less (more) likely to engage in real earnings management practices. Our results are of use to regulators, external auditors and investors.
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McGuire, Sean T., Thomas C. Omer, and Dechun Wang. "Tax Avoidance: Does Tax-Specific Industry Expertise Make a Difference?" Accounting Review 87, no. 3 (January 1, 2012): 975–1003. http://dx.doi.org/10.2308/accr-10215.
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ABSTRACT This study investigates whether the tax-specific industry expertise of the external audit firm influences its clients' level of tax avoidance. Our results suggest that clients purchasing tax services from their external audit firm engage in greater tax avoidance when their external audit firm is a tax expert. Because the external audit firm potentially influences clients' tax avoidance activities via the provision of tax consulting services and the financial statement audit, we also examine whether the overall expertise (i.e., the combined tax and audit expertise) of the external audit firm is associated with tax avoidance. We find that the external audit firm's overall expertise is generally associated with greater tax avoidance, which suggests that overall experts are able to combine their audit and tax expertise to develop tax strategies that benefit clients from both a tax and financial statement perspective. In combination, our results suggest that the tax-specific industry expertise of the external audit firm plays a significant role in its clients' tax avoidance. Data Availability: Data used in this study are available from public sources identified in the article.
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Zueva, Anna. "Geoinformation system as a controlling tool for External State Audit Bodies." Geocontext 8, no. 1 (December 31, 2020): 47–51. http://dx.doi.org/10.30987/2686-8326-2020-47-51.
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The Author justifies the needs of introducing Geo-Informational Systems into the daily activities of The External State Audit Bodies by revealing the concepts of both controlling and digital audit applications. With the development of introducing digital auditing into The Accounting Chamber of The Russian Federation along with Russia’s leadership role in INTOSAI, the time has come to modernize our information systems for the 21st century and beyond.
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Nguyen, Phuong Thi, and Michael Kend. "The perceived motivations behind the introduction of the law on external audit in Vietnam." Managerial Auditing Journal 32, no. 1 (January 3, 2017): 90–108. http://dx.doi.org/10.1108/maj-01-2016-1299.
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Purpose Over the past 20 years, external auditing activities and practices in Vietnam have developed quickly. An important milestone is the first Law on External Audit No. 67/2011/QH12 which has been passed by the National Assembly of Vietnam on 29 March 2011. The purpose of this paper is to understand the perceived motivations in regard to the introduction of the Law on External Audit, through the eyes of various key stakeholders. There has been genuine public interest concerns regarding audit quality in Vietnam as prior academic research has indicated, and this is the first study to examine whether the new audit reforms where introduced specifically to deal with those concerns. Design/methodology/approach Face-to-face semi-structured interviews were conducted with 45 key stakeholders during 2014 in both Ha Noi and Ho Chi Minh City, Vietnam. Findings The study finds that the Law on External Audit was introduced because it holds the highest form of regulatory authority in Vietnam, and the lower level Decrees that existed before the law did not even detail the audit firms’ responsibilities resulting in low audit quality. Also, the new Law was introduced to add more credibility and trust in the external audit function in Vietnam, and to reduce unfair price competition. However, some of our findings indicate that the Governments’ motivations were not all purely public interest related. A theoretical framework is developed to evaluate whether these reforms are substantive enough in nature to effect public confidence in reported financial data and audits. Originality/value External auditing plays a crucial role in any market-based economy. In a developing economy, audit quality is often perceived to be lower than in a developed economy. Therefore, it is not uncommon to observe governments in developing economies producing tighter regulations for the auditing and assurance market to help attract more foreign investment and to establish credibility and more trust. In Vietnamese context, the current study conveys that the new audit reforms not only were introduced with genuine public interest concerns but also were a mechanism to protect the government’s interests.
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Nath, Nirmala, Radiah Othman, and Fawzi Laswad. "External performance audit in New Zealand public health: a legitimacy perspective." Qualitative Research in Accounting & Management 17, no. 2 (December 2, 2019): 145–75. http://dx.doi.org/10.1108/qram-11-2017-0110.
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Purpose This paper aims to provide insights into how the New Zealand Office of the Auditor-General (NZOAG) legitimised the selection of topics for performance audit in the New Zealand public health sector over a 10-year period, 2003-2013, by fulfilling the key actors’ “taken for granted beliefs” of the dual roles of the NZOAG: its independence and accountability. Design/methodology/approach This paper uses evidence gathered from interviews with representatives of the District Health Boards, the Ministry of Health (including Health Advisory Committee members) and NZOAG staff, along with publically available documentary evidence over a 10-year period. The authors draw on Suchman’s (1995) authority on institutional legitimacy to inform the research findings. Findings The New Zealand Auditors-General (NZAGs) get inputs from various sources such as their own audit teams, parliamentary deliberations, the Ministry of Health, the District Health Boards, media and public concerns and complaints. These sources initiate ideas for performance audits. Subsequently, the NZAGs use the recurring themes and risk assessment criteria while simultaneously consulting with the auditees (the MOH and the DHBs) and other actors, such as health advisory groups, to select topics for such audits. This signals to the key actors, such as the MOH and the DHBs, that the NZOAG is addressing the topics and concerns relevant to the former while discharging its public accountability role. Furthermore, the consultative approach acts as a catalyst, ensuring that the actors involved with public sector health service delivery, specifically the auditees, accept the selected topic. This leads to a lack of resistance to and criticism of the topic; the selection process, therefore, is legitimatised, and credibility is added to the audits. Because of the consultative approach taken by the NZAGs, the actors, including the performance auditors, continue to believe that the Office acts independently from third party influence in selecting their audit topics, elevating the NZAGs’ moral legitimacy with respect to their public accountability role. Research limitations/implications The study’s focus group does not include parliamentary representatives, only representatives from the DHBs, the MOH and the NZOAG; therefore, the conclusions on effective discharge of the NZOAG’s accountability role and Parliamentary acceptance is not conclusive – the NZOAG acts on behalf of the Parliament in discharging its accountability role and the latter is also the formal recipient of the reports. Practical implications The implications for practitioners and policymakers are that the use of a consultative approach to select topics for performance audit in the absence of performance auditing standards ensures auditee readiness and acceptance of such audits. This also promotes mutual benefits and “trust” between the AG and auditees. Such audits can be used to bring about efficacy in health service delivery. Social implications The selected topics for audits will have an impact on citizens’ lifestyles, with improved health services delivery. Originality/value There is a dearth of research on who initiates the ideas for performance auditing and how the Office of the Auditor-General selects topics for such audits. This study adds a new dimension to the existing performance auditing literature. The authors reveal how the NZOAG seeks to legitimise the selection of topics for such audits by consulting with the auditees and other actors associated with public sector health service delivery, while upholding its independent status and making transparent how it discharges its accountability role within the context of performance auditing.