Auditors' Joint Engagements and Audit Quality

Auditors' Joint Engagements and Audit Quality
Author: Pietro A. Bianchi
Publisher:
Total Pages: 51
Release: 2019
Genre:
ISBN:

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This study examines the effect of auditors' collaboration in joint audit engagements on knowledge transfer, auditor expertise, and audit outcomes. I employ a unique sample of Italian private companies whose financial statements are jointly audited by three individual auditors and use measures from the network literature to capture the intensity of interactions between these auditors. I find a positive association between several audit quality proxies and auditors' collaboration in multiple joint engagements. My results suggest that auditors develop knowledge and contacts through collaboration which potentially leads to higher audit quality. Overall, my findings suggest that joint engagements facilitate knowledge transfer and increase auditor expertise.

Auditing Teams

Auditing Teams
Author: Mara Cameran
Publisher: Taylor & Francis
Total Pages: 133
Release: 2017-03-31
Genre: Business & Economics
ISBN: 1134825536

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The recent audit failures which have rocked financial markets worldwide have accentuated the need for a better understanding of the link between risk, control and audit quality; as well as emphasising the need to open the "black box" of the ways auditing firms actually function. Reflecting these imperatives, Auditing Teams unravels the organizational and management issues in audit firms that are key to achieving effectiveness in service provision. Specifically, this key research reflects upon the relevance and dynamics of auditing teams and their impact on auditing quality, and specifically responding to the recent claim from regulators which highlights auditing team characteristics as the source of wide variations in quality. By leveraging different perspectives – auditing, management accounting, organization and psychology – to investigate auditing teams and basing on evidence collected from the professional world, this book will provide a unique insight into the role of auditing teams on audit quality. It will be of great interest to scholars and advanced students in auditing, as well as to practitioners and regulators in the field.

From Joint to Single Audits - Audit Quality Differences and Auditor Pairings

From Joint to Single Audits - Audit Quality Differences and Auditor Pairings
Author: Claus Holm
Publisher:
Total Pages: 44
Release: 2017
Genre:
ISBN:

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This study analyses audit quality differences between audits by a single big audit firm and joint audits with either one or two big audit firms. We exploit the unique situation in Denmark beginning on 1 January 2005, at which time a long-standing mandatory joint audit system for listed companies was replaced by a voluntary joint audit system. First, we report the results of a survey of Danish CFOs' views on and their experiences with the choice of single or joint audits and their perceptions of audit quality. Second, based on data from the mandatory joint audit abolition year and the following two years, we test the audit quality differences using abnormal accruals. Most CFOs perceive that audit quality by a single big four audit firm is the same as it is in joint audits with either one or two big four audit firms. The results of our empirical analysis are in line with the perceptions. We find no evidence of audit quality differences between audits made by a single big four firm and those conducted by either of the two combinations of joint audits.

Auditing and Society

Auditing and Society
Author: Wally Smieliauskas
Publisher: Routledge
Total Pages: 489
Release: 2020-07-30
Genre: Business & Economics
ISBN: 0429854110

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Auditing has become an essential component in market societies and the need for auditing skills has risen in line with globalization. This textbook provides a comprehensive overview of the role of financial statement auditing in contemporary society, including the auditor’s role in evaluating the financial reporting of an auditee—a topic of central concern in the recent comprehensive review of the auditing profession in the Brydon Report (2019). The experienced authors provide insight into auditing research to help readers understand its function, regulation, and role in theory and practice. With focus on private sector financial statement auditing and its regulation, the book includes perspectives on social theory, history, and the importance of professional standards. The thought-provoking final chapter challenges students to consider the effectiveness of auditing in evaluating increasingly risky and complex accounting estimates involving assumptions about future events. A fundamental approach to auditing theory, this textbook will be useful reading for advanced undergraduate and postgraduate students across business and accounting fields.

The Effect of Joint Auditor Pair Composition on Audit Quality

The Effect of Joint Auditor Pair Composition on Audit Quality
Author: Gerald J. Lobo
Publisher:
Total Pages: 53
Release: 2019
Genre:
ISBN:

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Using a sample of firms from France, where the law requires the use of two auditors, we study the effect of auditor pair composition on audit quality by examining a specific account, goodwill impairment. We document that firms audited by a Big 4-non-Big 4 auditor pair (BS) are more likely to book an impairment and book a larger impairment than firms audited by a Big 4-Big 4 auditor pair (BB) when low performance indicators suggest a greater likelihood of impairment. Moreover, firms audited by a BB pair reduce impairment disclosures when they book impairments, while firms audited by a BS pair do not, suggesting lower transparency for firms audited by a BB pair. Our results inform investors and firms in mandatory joint audit regimes, as well as regulators who are considering requiring joint audits.

Auditing

Auditing
Author: Source Wikipedia
Publisher: University-Press.org
Total Pages: 128
Release: 2013-09
Genre:
ISBN: 9781230622330

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Please note that the content of this book primarily consists of articles available from Wikipedia or other free sources online. Pages: 126. Chapters: Sarbanes-Oxley Act, Audit trail, Regulation S-K, Auditor's report, Center for Audit Quality, Internal audit, Enterprise risk management, SOX 404 top-down risk assessment, Auditor independence, Statements on Auditing Standards, International Organization of Supreme Audit Institutions, Information audit, Clinical audit, Internal control, Datacenter star audit, Statement on Auditing Standards No. 70: Service Organizations, Audit committee, Chief audit executive, Financial audit, List of European Union directives, Fraud deterrence, Auditing Standards Board, Canadian Institute of Chartered Accountants, Materiality, Database audit, Worldwide Responsible Accredited Production, Institute of Internal Auditors, Global Reporting Initiative, Separation of duties, Continuous auditing, XBRL assurance, International Association of Airline Internal Auditors, RSM International, Helpdesk and incident reporting auditing, External auditor, Mazars, Mainframe audit, Environmental audits, Going concern, Sales tax audit, Certified Information Systems Auditor, Information technology security audit, Lease audit, International Standards on Auditing, Joint audit, International Federation of Accountants, Forensic accounting, GASB 45, Audit Bureau of Circulations, BPA Worldwide, Information Systems Audit and Control Association, Sycip, Gorres, Velayo & Co., Quality audit, Institut der Wirtschaftsprufer in Deutschland, International Register of Certificated Auditors, Assurance services, Event data, Financial Instruments and Exchange Law, Engagement Letter, Performance audit, ISA 500 Audit Evidence, Lead Auditor, Generally Accepted Auditing Standards, Software licensing audit, ITGC, Error account, Professional Evaluation and Certification Board, Management assertions, Court of Audit, International Federation of Audit Bureaux of Circulations, ..

Auditor Multinational Expertise and Audit Quality

Auditor Multinational Expertise and Audit Quality
Author: Joshua L. Gunn
Publisher:
Total Pages: 46
Release: 2017
Genre:
ISBN:

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Over the past several decades, the scope of public companies' operations has become increasingly global. This has led to concern over the ability of audit firms to conduct high-quality audits across geographically dispersed foreign operations. We contribute to the growing body of research in this area by investigating the association between audit quality and local audit offices' expertise in conducting multinational audit engagements. We use two complementary measures to proxy for an audit office's multinational expertise: (i) local multinational market leadership, and (ii) country-specific experience. Using a sample of multinational client firms headquartered in the United States, we consistently find that audit quality is stronger when the auditor possesses expertise conducting global group audits, possesses particular expertise in the country where a client has a significant subsidiary, or possesses both types of expertise on an engagement. Several sample partitions reinforce our main results. The results are robust to propensity score matching as well as a placebo test using clients of the audit office that generate no foreign sales. Our evidence suggests that the challenge of conducting multinational audits is more easily met by auditors with expertise on these types of engagements.

Audit Regulations, Audit Market Structure, and Financial Reporting Quality

Audit Regulations, Audit Market Structure, and Financial Reporting Quality
Author: Christopher Bleibtreu
Publisher:
Total Pages: 200
Release: 2021-11-24
Genre:
ISBN: 9781680839005

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Audit Regulations, Audit Market Structure, and Financial Reporting Quality provides a structured overview of the empirical and analytical literature on the effects of audit market regulations. After a short introduction, the monograph is organized as follows. Chapter II addresses the structure of the audit markets of industrialized countries. First presenting an overview of the concentration metrics used to describe the structure of an audit market or a market segment, then providing the empirical findings on audit market concentration at the national level and presenting an overview of the main reasons that led to the currently high degree of concentration. Chapter III summarizes the reasons why regulators worldwide consider a high degree of concentration to be a concern. In particular, it reviews the regulator's assumption that a high degree of concentration inevitably leads to a low degree of competition and to the corresponding effects of low audit quality and high audit fees. It also provides an overview of the empirical findings on the association between concentration and audit quality and fees, respectively. Chapter IV introduces the mandatory audit firm rotation, the prohibition on the joint supply of audit and non-audit services, and joint audits as examples for regulations that are likely to have both incentive and market structure effects. Chapter V summarizes the empirical findings on the effects of these regulations on audit quality and market structure. Chapter VI summarizes models that regard the market structure as given. The results from these models show that the effects of regulations are not straightforward, but depend on various factors related to the auditor, the client, and the legal environment. Chapter VII gives an overview of analytical research that simultaneously considers incentive effects and market structure effects. It also provides a brief overview of industrial organization models that seem suitable to expand the models applied to investigate the effects of audit regulations. Chapter VIII concludes and highlights avenues for future research.