Brooke D. Beyer, Michelle A. Draeger, Eric T. Rapley
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引用次数: 0
Abstract
PurposeThe process performed during a financial statement audit is critical but is unobservable to external stakeholders. This can create challenges in assessing the quality of individual audit engagements. This study’s objective is to introduce and investigate an archival measure based on publicly available information that proxies for audit process ineffectiveness.Design/methodology/approachWe proxy for audit process ineffectiveness using errors in the audit report. We examine audit reports to identify errors because the audit report represents the auditor’s primary communication with financial statement users and is subject to rigorous preparation and review. We first examine if typical factors influencing audit process ineffectiveness are associated with audit report errors. We then examine whether audit reports containing errors are associated with audit quality measures.FindingsWe find that errors are more likely to be present in audit reports when time pressure exists and less likely when auditors exert more effort and when audit engagement risk is higher. Results also show that errors in audit reports are positively associated with financial reporting misstatements, measured by subsequently disclosed Big R restatements and out-of-period adjustments.Originality/valueCollectively, our evidence suggests that an audit report containing an error is a suitable proxy for audit process ineffectiveness. This proxy has audit quality implications because inattentiveness in one area of the audit process could indicate inattentiveness in another area.
目的 财务报表审计过程至关重要,但外部利益相关者却无法观察到这一过程。这给评估单个审计业务的质量带来了挑战。本研究的目的是引入并调查一种基于公开信息的档案测量方法,以替代审计过程的无效性。我们检查审计报告以识别错误,因为审计报告是审计师与财务报表用户的主要沟通渠道,需要经过严格的准备和审查。我们首先研究影响审计过程无效性的典型因素是否与审计报告中的错误有关。我们发现,在时间压力较大的情况下,审计报告中出现错误的可能性较大;而在审计师付出更多努力和审计业务风险较高的情况下,审计报告中出现错误的可能性较小。结果还显示,审计报告中的错误与财务报告错报呈正相关,以随后披露的 Big R 重述和期外调整来衡量。这种替代方法对审计质量有影响,因为审计过程中一个领域的不专心可能表明另一个领域的不专心。
期刊介绍:
Accounts of Chemical Research presents short, concise and critical articles offering easy-to-read overviews of basic research and applications in all areas of chemistry and biochemistry. These short reviews focus on research from the author’s own laboratory and are designed to teach the reader about a research project. In addition, Accounts of Chemical Research publishes commentaries that give an informed opinion on a current research problem. Special Issues online are devoted to a single topic of unusual activity and significance.
Accounts of Chemical Research replaces the traditional article abstract with an article "Conspectus." These entries synopsize the research affording the reader a closer look at the content and significance of an article. Through this provision of a more detailed description of the article contents, the Conspectus enhances the article's discoverability by search engines and the exposure for the research.