Managerial Auditing Journal最新文献

{"title":"Measuring novice auditor orientation and its impact on judgment","authors":"Ferdy van Beest, Robert Pinsker","doi":"10.1108/maj-04-2023-3895","DOIUrl":"https://doi.org/10.1108/maj-04-2023-3895","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>The purpose of this study is to construct and test a new measure of auditor orientation using two audit quality-related tasks.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The sample consists of 66 Dutch and US graduate auditing students. Participants complete two tasks: one involving a lease classification and another, supplemental experiment involving a contingent liability judgment. The purpose is to construct a new measure for rules-based/ principles-based orientation. Rigorous, psychometric testing confirms that parts of tolerance for ambiguity (TOA) and need for cognition (NFC), together, form a new construct the authors identify as auditor orientation. The authors next conduct a main and supplemental experiment with novice auditor participants from both the USA and the Netherlands.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The authors begin with rigorous, psychometric testing using participants from the USA and the Netherlands. The resulting 10-item scale combines parts of TOA and NFC to reflect auditor orientation. The common themes across scale items are high (low) adaptability to complexity and a substance-over-form (form-over-substance) preference for principles-oriented (PO) (rules-oriented [RO]) auditors. Conducting two experiments, results from two distinct tasks confirm our research question; novice auditors classified as RO (PO) are more (less) likely to recommend a more aggressive/client-favorable disclosure judgment.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>Auditor orientation (i.e. rules or principles) has a significant impact on the application of rules-based or principles-based standards. How the standards are applied, therefore, influences auditor decision-making and thus audit quality. However, there is a paucity of auditor orientation research to date, including a validated measure. The study contributes a new measure for future research in the related accounting standards and audit quality literatures, while also identifying a potentially important construct in auditor training.</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"21 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-01-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139551866","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The power of institutional investors: empirical evidence on their role in investment in internal audit function","authors":"Adel Ali Al-Qadasi","doi":"10.1108/maj-04-2023-3882","DOIUrl":"https://doi.org/10.1108/maj-04-2023-3882","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Institutional investors are major shareholders in publicly traded firms and play crucial roles in the financial and governance aspects of these firms. Despite their importance, little is known about their role in internal auditing. This study aims to fill this gap by investigating the relationship between institutional investors’ ownership and investment in the internal audit function (IAF).</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The study uses ordinary least squares regressions with two-way cluster-robust standard errors (firm and year) to estimate the relationship between institutional investors’ ownership and investment in IAF for Malaysian listed firms between 2009 and 2020.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The findings show that companies with higher levels of institutional ownership invest more in IAF, suggesting that institutional investors can effectively monitor managers due to their large holdings. Moreover, both transient and dedicated institutional investors are more likely to invest in IAF.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>The results highlight the importance of institutional investors as a significant determinant of investment in IAF, which can aid regulators and managers in understanding the institutional investors’ role in governing and optimizing the efficient use of a firm’s resources. The findings also provide insight into institutional investors’ behavior regarding monitoring systems, which may inspire regulators and policymakers to consider increasing institutional investors’ participation to enhance governance structures.</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"36 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-01-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139422695","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The effect of the internal audit function’s perceived assurance versus advisory purpose on the external auditor’s reliance decision","authors":"Dereck Barr-Pulliam, Marc Eulerich, Nicole Ratzinger-Sakel","doi":"10.1108/maj-08-2023-4021","DOIUrl":"https://doi.org/10.1108/maj-08-2023-4021","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to examine the extent to which external auditors (EAs) use the work of the internal audit function (IAF) based on the purpose of its primary activities. The authors rely on attribution theory, which suggests that individuals search for meaning when an event occurs. In this setting, the authors explore how the overall (assurance vs advisory) or specific (e.g. risk management and evaluating internal controls) focus of IAF activities influences perceived EA reliance on the IAF’s work.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The authors first explore the research question with data extracted from a broad, longitudinal survey conducted triennially by the national chapters of the Institute of Internal Auditors in Austria, Germany and Switzerland. The data includes responses from 2014, 2017 and 2020 administrations of the survey. The authors conduct a parallel survey with practicing EAs attending two training sessions of a European office of a global network firm. Hypotheses were tested using ordered logistic regression.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Among the chief audit executive (CAE) participants, the authors observe that a balanced or primarily assurance-related purpose of the IAF, relative to a primarily advisory-related purpose, is associated with higher perceived EA reliance. The authors observe similar perceptions of the extent of reliance among the EA participants.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>With a unique data set of practicing internal auditors from three countries, coupled with a sample of EAs, to the best of the authors’ knowledge, this study is the first to examine differences in EA reliance across the IAF’s primary roles. The study relies on data from three European countries, which differs from prior EA reliance literature with a largely North American focus. Further, comparison between perceptions of EAs and CAEs is a novel approach and this paper’s findings suggest that perceptions of CAEs could be a reliable proxy for EA-intended behavior.</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"3 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-01-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139374004","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Cognitive dissonance and auditor professional skepticism","authors":"Ruwan Adikaram, Julia Higgs","doi":"10.1108/maj-08-2022-3653","DOIUrl":"https://doi.org/10.1108/maj-08-2022-3653","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to demonstrate how pressures (incentives) in the audit environment can lower audit quality because of a breakdown between professionally skeptical (PS) judgment (risk assessment) and PS action (testing).</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The authors used a Qualtrics-based experiment with attitude change as a proxy measure of cognitive dissonance (CD). The authors analyze the results using a one-way independent between-group ANOVA with post hoc tests and <em>t</em>-tests.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The authors find that auditors experience CD when they fail to take appropriate high PS action (audit tests) that are in line with high PS judgment (risk assessments). The motivational force to reduce CD drives auditors to revise their assessments upward (rank higher), lower diagnostic audit tests (PS actions) and lower risk assessments (PS judgments). This leads to lower overall professional skepticism, and hence lower audit quality.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This investigation provides an empirical investigation of Nelson’s (2009) model of professional skepticism and demonstrates a specific mechanism for how incentives in the audit environment lower audit quality. Based on the findings, treatments to enhance audit quality can benefit by strengthening the critical link between PS judgments (risk assessments) and PS actions (audit tests).</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"93 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-01-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139373884","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Secrecy culture, client importance, and auditor reporting behavior: an international study","authors":"Brian M. Lam, Phyllis Lai Lan Mo, Md Jahidur Rahman","doi":"10.1108/maj-11-2022-3763","DOIUrl":"https://doi.org/10.1108/maj-11-2022-3763","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to investigate whether auditors compromise their independence for economically important clients in countries with a secrecy culture.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The authors empirically examine the research question based on a data set of 33 countries for the period from 1995 to 2018. The dependent variable is the auditors’ propensity to issue modified audit opinions, which is a proxy for auditor independence. The authors use relative client size as a proxy for client importance. The authors adopt the Heckman (1979) two-stage model to mitigate the potential endogeneity issue involved in the selection of Big-N auditors.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Using a large sample of firms and controlling for the firm- and country/region-level factors, this study reveals that both Big-N and non-Big-N auditors are more likely to issue modified audit opinions to clients located in countries with a strong secrecy culture relative to those located in other countries. However, Big-N auditors are more likely to issue modified audit opinions for their economically important clients with a secrecy culture relative to their other clients, while no or weaker evidence is found for non-Big-N auditors. The results are consistent and robust to endogeneity tests and sensitivity analyses.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study enriches the literature by providing a new perspective on auditor independence that an auditor’s reporting behavior can vary depending on the client’s importance and auditor type, even under the same secrecy culture.</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"26 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-01-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139374128","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Audit quality and debt restructuring: evidence from Italy","authors":"Carlotta Magri, Pier Luigi Marchini","doi":"10.1108/maj-01-2023-3794","DOIUrl":"https://doi.org/10.1108/maj-01-2023-3794","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to investigate the link between audit quality and in-court debt restructuring. The aim is to understand whether the confirmation of debt restructuring plans is affected by audit quality, which, in the light of agency theory, reduces information asymmetries between outsiders (creditors and the court) and insiders (shareholders and managers) of the debtor company.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>A logistic regression is performed to test whether higher audit quality is associated with an increased probability of successfully completing a debt restructuring proceeding (RP). Consistent with the literature, audit quality is assessed ex ante based on auditor size, which is used as a proxy for independence. The analysis considers private Italian companies.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Audit quality positively affects debt restructuring. Among financially distressed companies, those audited by an audit company are more likely to succeed in RPs than those audited by a single practitioner. There is no evidence of a Big N effect.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study fills a gap in literature as, in contrast to other financial and governance characteristics, audit quality has never been studied before as a determinant of efficient restructuring. It contributes to the literature on auditing and governance by highlighting the importance of audit quality in complex situations such as RPs, and it expands on debt restructuring literature by considering the importance of the information exchanged during RPs.</p><!--/ Abstract__block -->","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"18 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2023-12-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138515758","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"High-speed rail network and earnings management techniques usage trade-off: the moderating effects of governance and religion","authors":"Bin Li, Zhao Qizi, Yasir Shahab, Xun Wu, Collins G. Ntim","doi":"10.1108/maj-01-2023-3799","DOIUrl":"https://doi.org/10.1108/maj-01-2023-3799","url":null,"abstract":"Purpose This study aims to investigate the impact of the development of high-speed rail (HSR) network on earnings management, especially on the trade-off between the usage of accruals-based earnings management (AM) and real earnings management (RM) techniques, and consequently, examines the extent to which the HSR network–earnings management nexus is moderated by governance and religion factors. Design/methodology/approach Using a sample of Chinese A-listed firms over an 11-year period, this study uses regression techniques as the baseline methodology while controlling for industry and year-fixed effects. The authors also use endogeneity tests (including instrumental variable method, Generalized Methods of Moments estimation and difference-in-difference) and different robustness checks. Findings The key findings are threefold. First, the HSR network development reduces AM. This suggests that the presence of HSR network is effective in reducing information asymmetry. Second, the use of RM technique increases with the HSR network development. This indicates that managers do not seem to engage in less earnings management with the HSR network development but instead appear to switch from the easy-to-detect AM to the more costly RM approach. Finally, the HSR network and earnings management nexus is moderated by governance and religion factors. Originality/value This study provides new evidence on the trade-off between AM and RM by managers and pioneers in examining the impacts of governance and religion factors on the relationship between the HSR network and the trade-off of earnings management techniques.","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"51 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2023-11-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139242879","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Does trust matter in external audits? The role of audit committee chair’s trust in external audits","authors":"Kwok Yip Cheung, Chung Yee Lai","doi":"10.1108/maj-10-2022-3737","DOIUrl":"https://doi.org/10.1108/maj-10-2022-3737","url":null,"abstract":"Purpose This study aims to investigate the impact of the audit committee chair’s trust on the quality of interactions between the external auditor and the audit committee chair in Hong Kong. Design/methodology/approach The research uses a questionnaire survey to gather data from the audit committee chairs of the listed companies in Hong Kong, with a response rate of 19.2%. Partial least squares structural equation modelling is used in this study. Findings The results reveal that the audit committee chair’s trust in the external auditor’s competence, integrity and goodwill is an important determinant of the interaction quality. The findings also show that interaction quality during the pre-engagement stage is important to mediate the relationships between the three dimensions of trust and interaction quality during the audit performance stage. Originality/value This is the first study, to the best of the author’s knowledge, that examines the impact of the audit committee chair’s trust in the external auditor on the quality of their interactions. The findings provide insights for board of directors, auditors and policymakers to implement policies that enhance trust between them to improve audit quality.","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":" 2","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-11-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135192536","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Audit partners’ gender and time variances of key audit matters","authors":"Md Khokan Bepari, Abu Taher Mollik","doi":"10.1108/maj-11-2022-3752","DOIUrl":"https://doi.org/10.1108/maj-11-2022-3752","url":null,"abstract":"Purpose This study aims to examine whether audit partners’ gender affects the year-to-year changes (year-to-year additions and drops) of key audit matters (KAMs) identified in the audit report. This study also examines whether female audit partners’ audit experiences, accounting education and narcissism reduce the difference in time variances of KAMs reporting between female and male audit partners. This study defines the year-to-year additions and drops of KAMs as the time variance of KAMs. Design/methodology/approach Data of this study includes the audit reports of Australian Securities Exchange 300 companies for the period from 2017 to 2021. This study also applies the theory of female auditors’ preference for anchoring and availability heuristics. This study uses multivariate regression with robust standard errors clustered by the firms. This study also uses several robustness tests. Findings The findings suggest that female audit partners disclose fewer time variant KAMs in that they have a lower tendency both to add new KAMs and to drop old KAMs. Further analysis suggests that the differences between female and male audit partners decrease as the female audit partners’ experience increases or if the female audit partner possesses a bachelor’s degree in accounting. Female audit partners’ narcissism also reduces the gender gap in the time variances of KAMs. Practical implications The fact that female audit partners report more stable KAMs implies that there are differences between female and male audit partners in the way audit risk assessments are conducted, audits are planned and professional judgement is applied by female and male audit partners. Social implications The findings imply that female audit partners’ experience, accounting education and narcissistic personality can play a significant role in explaining the differences in audit outcomes produced by male and female audit partners. Originality/value This study is novel in showing that female audit partners report more stable and less time-variant KAMs. The findings of this study may inform audit firms and regulators that female audit partners’ experience, tertiary qualifications in accounting and narcissistic personality traits may be effective means of reducing the gender gap in auditing. The findings also imply that auditors’ observable and unobservable personality traits affect audit outcomes.","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"7 s2","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-11-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135431105","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"All my rowdy friends: the effect of Super Bowl hosting on audit and financial reporting timeliness","authors":"Matthew D. Crook, Tamara A. Lambert, Brian R. Walkup, James D. Whitworth","doi":"10.1108/maj-06-2022-3585","DOIUrl":"https://doi.org/10.1108/maj-06-2022-3585","url":null,"abstract":"Purpose The purpose of this paper is to examine the impact hosting the Super Bowl has on audit completion and financial reporting timeliness for companies headquartered in Super Bowl hosting cities. Design/methodology/approach Using 16 years of financial reporting data, this study uses the Super Bowl and related activities, combined with required filings during “busy season,” as a natural experiment to examine how audit firms navigate short-term, exogenously imposed but anticipated, audit team capacity constraints. Findings Companies headquartered in a city hosting the Super Bowl, during busy season, have longer audit report lags (by approximately three days, in comparison to non-hosting busy season audits) and less timely securities and exchange commission (SEC) (10-K) filings. The authors find no evidence that Super Bowl hosting affects audit fees or earnings announcement timeliness. Practical implications When confronted with anticipated capacity shocks, audit firms take longer to complete the audit, absorbing the financial costs of the delay and maintaining audit quality, resulting in less timely financial reporting. Originality/value This study demonstrates the costs of Super Bowl-related inefficiencies and contributes to our understanding of how auditors navigate capacity shocks. This study provides evidence that auditors can effectively manage business risk and continue to facilitate providing timely and accurate information to financial statement users in the face of a capacity shock.","PeriodicalId":47823,"journal":{"name":"Managerial Auditing Journal","volume":"80 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136263726","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}