The uncertainties of risk management

2014 ◽  
Vol 27 (3) ◽  
pp. 489-526 ◽  
Author(s):  
Eija Vinnari ◽  
Peter Skærbæk
Keyword(s):  
Risk Management ◽  
Network Theory ◽  
Internal Audit ◽  
Actor Network Theory ◽  
Legal Aspects ◽  
Structured Interviews ◽  
Management Tools ◽  
Content Type ◽  
Internal Auditors ◽  
Multiple Frames

Purpose – The purpose of this paper is to analyse the implementation of risk management as a tool for internal audit activities, focusing on unexpected effects or uncertainties generated during its application. Design/methodology/approach – Public and confidential documents as well as semi-structured interviews are analysed through the lens of actor-network theory to identify the effects of risk management devices in a Finnish municipality. Findings – The authors found that risk management, rather than reducing uncertainty, itself created unexpected uncertainties that would otherwise not have emerged. These include uncertainties relating to legal aspects of risk management solutions, in particular the issue concerning which types of document are considered legally valid; uncertainties relating to the definition and operationalisation of risk management; and uncertainties relating to the resources available for expanding risk management. More generally, such uncertainties relate to the professional identities and responsibilities of operational managers as defined by the framing devices. Originality/value – The paper offers three contributions to the extant literature: first, it shows how risk management itself produces uncertainties. Secondly, it shows how internal auditors can assume a central role in the risk management system. Thirdly, it develops Callon's framing/overflowing framework with the notion that multiple frames are linked and create unexpected dynamics, and applies it to the study on the effects of risk management tools in an internal audit context. It shows how, despite recurring attempts to refine risk management, further uncertainties are continuously produced, thus providing an empirical illustration of how reframing and overflowing intertwine in a continual process.

scholarly journals An actor-network theory perspective to study the non-adoption of a collaborative technology intended to support online community participation

2016 ◽  
Vol 29 (3) ◽  
pp. 347-365
Author(s):  
Gibran Rivera ◽  
Andrew M. Cox
Keyword(s):  
Network Theory ◽  
Interface Design ◽  
Online Community ◽  
Critical Role ◽  
Actor Network Theory ◽  
Adoption Process ◽  
Structured Interviews ◽  
Actor Network ◽  
Content Type ◽  
Collaborative Technology

Purpose The purpose of this paper is to explore the value of Actor-network theory as an approach to explain the non-adoption of collaborative technology. Design/Methodology/Approach The notion of translation and related concepts pertaining to Actor-network theory are used to explore the case of non-participation in an organizational online community. Semi-structured interviews were conducted with 30 HR professionals belonging to a multi-campus university system in Mexico. Findings The study shows that participation in the online community did not occur as expected by those promoting its use. An initial inductive analysis showed that the factors that undermine participation had to do with the interface design of the technology and the individual motivations and benefits derived from participation. A second analysis, using ANT showed how processes of negotiation, conflict, enrolment, alignment, and betrayal that occurred during the emergence and evolution of the new network played a critical role in technology adoption leading to the dissolution of the initiative to adopt the collaborative technology. Originality/value The study shows the value of ANT as a tool to better understand the adoption and use of collaborative technology. The analysis goes beyond existing explanations of participation, which tend to focus attention on matters such as the interface design or the personal motivations and benefits derived from participation. It does so by moving away from solely looking at what occurs within the boundaries of a community and understanding the context within which it is being introduced. It prompts the analysis of moments of problematization, interessement, enrolment, and mobilization to explore the adoption process, including the role of non-human actors.

An actor–network theory model of property development

2018 ◽  
Vol 11 (2) ◽  
pp. 246-262
Author(s):  
Emily Ward
Keyword(s):  
Network Theory ◽  
Development Process ◽  
Actor Network Theory ◽  
Theory Model ◽  
Structured Interviews ◽  
Property Development ◽  
Actor Network ◽  
Content Type ◽  
Structure And Agency ◽  
Core Actor

Purpose The purpose of this paper is to model the property development process from an actor–network theory perspective. The model aims to address the relationship between structure and agency to combine the social and the economic aspects of the property development process. Design/methodology/approach An inductive methodology was appropriate for this study. Consequently, 12 semi-structured interviews have been carried out with professionals involved in the property development process in central London. Findings Analysis of the interview transcripts revealed that throughout the development process a developer creates a core actor–network and enrols those required for production. Economic, cultural, legal and political structures influence actions throughout the development process and therefore have the ability to cause disruption. As a result, sub-networks are created to overcome challenges throughout the development process, such as obtaining planning consent. This allows the interests of actors to be aligned or re-aligned so that solutions can be punctualised into the core actor–network. Additionally, structures are affected by actions throughout the property development process. Practical implications It is recommended that developers measure the extent to which the interests of actors are successfully aligned and re-aligned throughout a developments life cycle, in addition to a developments financial success. The findings are paramount for policymakers and regulators, as it allows them to understand the intricate workings of the development process and so when they regulate or develop policy, they will understand how it will reverberate through the process and recalibrate it, thereby limiting unforeseen consequences. Originality/value This research has proven valuable given it advances the property development process literature by examining the property development process from an actor–network theory perspective and provides areas for further study.

Internal auditor perceptions of corporate governance in Greece after the crisis

2019 ◽  
Vol 17 (2) ◽  
pp. 201-227
Author(s):  
Charilaos Mertzanis ◽  
Vangelis Balntas ◽  
Thodoris Pantazopoulos
Keyword(s):  
Corporate Governance ◽  
Sovereign Debt ◽  
Debt Crisis ◽  
Internal Audit ◽  
Sovereign Debt Crisis ◽  
Structured Interviews ◽  
Content Type ◽  
Internal Auditors ◽  
Short Period

Purpose This paper aims to present the views of internal auditors in Greece on the relation between the internal audit function (IAF) and corporate governance (CG) after several years of European market integration and in the aftermath of the sovereign debt crisis. Design/methodology/approach Data are collected using semi-structured interviews with 15 internal auditors working in firms with different size and in different sectors of activity. Interviewees have diverse experience and hold various positions in the firm. Findings Respondents perceive a strong relation between the IAF and CG. They view the IAF as a preventive tool that provides monitoring and advisory services to firms. They stress the inadequate monitoring role of the board in the IAF, and they support a proactive intervention in the strategic audit planning process. They see a small role for shareholders in CG. They stress the need to focus more on the efficiency and effectiveness considerations in carrying out the IAF. They perceive CG-related information as important for meeting formal compliance needs rather than contributing to decision-making or audit process planning. They believe that audit committees (AC) are weak in implementing effective monitoring, due to inadequate knowledge and expertise of their members. They would like to see a two-way interaction between auditors, AC and management. They would like to enjoy more independence through the implementation of international standards of auditing and statutory regulation. Research limitations/implications The sample covers 15 auditors from an equivalent number of firms and few sectors of activity. Accessing potential interviewees was difficult due to the perceived conflict between their work requirements and public statement of their views. Practical implications The proposed method adds to the qualitative analysis literature with regard to measuring and evaluating the personal views of auditors on CG. The study provides empirical evidence of the need to use extensive qualitative research to assess the auditors’ views on the role of CG for their work. Originality/value The role of internal audit in CG effectiveness is a key policy concern, especially in countries with diverse market environments. Greece is such an environment for it has undergone a major institutional change within a short period and suffered greatly from its sovereign debt crisis. Further, few studies have sought and evaluated the views of internal auditors by using semi-structured interviews. The latter provide details, which other methods cannot capture. The results of this study are especially useful to the competent regulators, for they reflect market perceptions on the importance and effectiveness of CG practices. They are also useful to practitioners to identify potential root causes of audit deficiencies.

Risk-based internal audit: factors related to its implementation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Petros Lois ◽  
George Drogalas ◽  
Michail Nerantzidis ◽  
Ifigenia Georgiou ◽  
Eleni Gkampeta
Keyword(s):  
Risk Management ◽  
Chief Executive Officers ◽  
Audit Committee ◽  
Empirical Studies ◽  
Relevant Literature ◽  
Internal Audit ◽  
Chief Executive ◽  
Management Training ◽  
Content Type ◽  
Internal Auditors

Purpose This study aims to investigate the factors associated with the implementation of risk-based internal audit (RBIA). Design/methodology/approach As a first step, a literature review of the relevant literature is performed and five potential factors related to the implementation of RBIA are identified. Based on that, this paper constructs a questionnaire survey sent out to 185 internal auditors, executives and accountants in Greece to receive 90 responses during the period of November 2019–January 2020. Multiple regression analysis is conducted to identify the factors related to the implementation of RBIA. Findings This paper shows that there is a statistically significant positive relationship between the implementation of RBIA and: the provision of risk management training, an active audit committee role and the establishment of a formalized risk management system. Practical implications The results have important implications for internal auditors, chief executive officers and accountants who wish to enhance internal audit effectiveness and the accuracy and quality of financial information. Originality/value Empirical studies on the factors related to the implementation of RBIA are rare. This is the first study to create empirical variables based on a thorough review of the relevant literature to empirically investigate the factors that are related to the implementation of RBIA in an emerging economy. By focusing on the Greek context, this study also sheds light to other countries with similar corporate governance systems, thus providing insights to settings where the Type II agency problem exists (La Porta et al., 1999).

scholarly journals Exploring diversity in sustainability assurance practice

2019 ◽  
Vol 32 (2) ◽  
pp. 556-580 ◽  
Author(s):  
Charika Channuntapipat ◽  
Anna Samsonova-Taddei ◽  
Stuart Turley
Keyword(s):  
Network Theory ◽  
Design Methodology ◽  
Actor Network Theory ◽  
Major Effect ◽  
Structured Interviews ◽  
Content Type ◽  
Textual Data ◽  
New Perspective ◽  
Assurance Process ◽  
The Uk

Purpose The purpose of this paper is to understand sustainability assurance (SA), and diversity in that practice, by examining assurance providers’ understandings of the practice and the influences that those understandings have on the actual assurance process. It focuses on the issues beyond the content of statements in SA reports. Design/methodology/approach This paper employs semi-structured interviews, supplemented by textual data sources. Research participants are assurance providers in the UK, including those within and outside the accounting profession. Drawing on the perspective of actor-network theory, the study focuses on the associations between different actors and how those shape the assurance practice. Findings The findings indicate that providers’ understandings of SA practice vary significantly. This variation has a major effect on how the assurance practice is conducted. The study identifies four types of SA engagements, which are designated as: social assurance, integrated assurance, formative assurance and compliance assurance. Such a categorization provides a broad-based understanding of the operationalization of SA and the degree of heterogeneity within it. Originality/value This paper extends the understanding of SA by focusing on the practice beyond the statements made by assurance providers, which have been the predominant focus of analysis in the existing literature, and by offering a categorization of the diversity in practice. The focus on the associations between assurance providers and other actors provides a new perspective for exploring the fundamentals of the practice.

The perceived scope of internal audit function in Libyan public enterprises

2015 ◽  
Vol 30 (6/7) ◽  
pp. 560-581 ◽  
Author(s):  
Wahid Omar Abuazza ◽  
Dessalegn Getie Mihret ◽  
Kieran James ◽  
Peter Best
Keyword(s):  
Chief Executive Officers ◽  
Internal Audit ◽  
Chief Executive ◽  
Structured Interviews ◽  
Content Type ◽  
Factors Affecting ◽  
Internal Auditors ◽  
Organizational Functions ◽  
Scant Attention ◽  
Executive Officers

Purpose – The aim of this exploratory study is to examine the perceptions of stakeholders regarding the scope of internal audit (IA) work in Libyan state-owned enterprises. Design/methodology/approach – Data were gathered through semi-structured interviews with chief executive officers, IA directors, administrative affairs managers, financial affairs managers and external auditors, which were supplemented with a review of relevant documentary evidence. Findings – The results of the study show that the scope of IA in Libyan organizations may not be sufficiently wide ranging to be considered as a value-adding service. The scope of the IA function may need to be expanded to cover a broader range of organizational functions if internal auditors are to offer value-adding services to their stakeholders. Practical implications – The IA profession has received scant attention in the literature, especially in the context of developing countries such as Libya. Therefore, such settings offer the potential to enhance the understanding of IA practices. As a study on a developing economy, it enhances understanding of the IA profession’s global configuration beyond the predominantly market-driven, industrialized Western economies. Originality/value – In contrast to most previous studies, this study covers a broad range of IA stakeholders’ views on the role of internal auditors. This coverage enabled an in-depth investigation of the factors affecting IA scope and understanding of stakeholder perceptions on the IA function.

New perspective on the black box of internal auditing and organisational change

2016 ◽  
Vol 31 (8/9) ◽  
pp. 804-820 ◽  
Author(s):  
Aviv Kidron ◽  
Yuval Ofek ◽  
Herztel Cohen
Keyword(s):  
Public Sector ◽  
Quantitative Methods ◽  
Internal Audit ◽  
Organisational Change ◽  
Internal Auditing ◽  
Content Type ◽  
Internal Auditors ◽  
The Public ◽  
Innovative Model ◽  
Audit Information

Purpose The shift from the traditional audit towards performance audit implies that internal auditors in the public sector function as change agents who underpin the fundamental change process. This paper aims to propose a model that identifies the determinants of organisational change in the public sector that result from internal auditing and the way internal auditors facilitate it. Design/methodology/approach The conceptual discussion of this paper is based on a review of relevant literature, both practical and academic. Findings This paper develops an innovative model that describes the factors leading to auditees’ change readiness after undergoing internal audit processes. The independent variable is audit information quality and the dependent variable, organisational change. Auditees’ perceptions is the mediator variable, and accessibility to audit information is the moderator variable. Practical implications The proposed model suggests the advantages that can be gained by audit-related services, which in turn will add value to the organisation. The relationships between the variables inform practitioners on how to support effective audits as a means of increasing performance and influencing organisational change. Originality/value As the paper offers an innovative model, it may open up new research areas in internal auditing that can be studied by using both qualitative and quantitative methods.

Internal auditing and assurance of corporate social responsibility reports and disclosures: perspectives of some internal auditors in Ghana

2016 ◽  
Vol 12 (4) ◽  
pp. 706-718 ◽  
Author(s):  
Samuel Nana Yaw Simpson ◽  
Francis Aboagye-Otchere ◽  
Ruby Lovi
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Internal Audit ◽  
Structured Interview ◽  
Research Approach ◽  
Limited Information ◽  
Content Type ◽  
Internal Auditors ◽  
Changing Roles ◽  
Corporate Social

Purpose This study aims to examine the nature and extent of internal auditors’ (IAs) involvement in corporate social responsibility (CSR) assurance. It also ascertains the capacity building requirements to legitimise the role of IAs as a credible form of providing CSR assurance. Design/methodology/approach A qualitative research approach was adopted, where data were collected through semi-structured interview of IAs of companies in Ghana that produce CSR reports. Findings Findings suggest that companies appreciate the fact that the internal audit function could provide independent assurance on CSR reports. However, there is limited information on the nature and scope of the assurance procedures. Moreover, most IAs seem to lack the requisite knowledge and skills needed to effectively carry out CSR assurance engagements. These evidences suggest a relatively low level of reliance being placed on CSR assurance services provided internally. Research limitations/implications Findings are purely based on the perceptions of IAs. Future studies may include the views of those who appoint IAs (i.e. management). Practical implications Findings engender discussions on the need for IAs and regulators of IAs (e.g. the Institute of Internal Auditors), particularly those in developing countries to begin to conscientise practitioners on the changing roles of the IA in the areas of CSR and CSR assurance. Originality/value This study is one of the very few studies on CSR assurance from the perspective of IAs and it also based on evidence from an African context. Also, the study provides evidence on the need for a deliberate effort to equip internal audit practitioners to provide at least some minimal assurance on CSR disclosures and reports.

Organizational identity, professional identity salience and internal auditors’ assessments of the severity of internal control concerns

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ian Burt ◽  
Theresa Libby
Keyword(s):  
Professional Identity ◽  
Internal Control ◽  
Organizational Identity ◽  
Internal Audit ◽  
Identity Salience ◽  
Content Type ◽  
Internal Auditors ◽  
Internal Control Weaknesses ◽  
The Impact ◽  
Benefits And Costs

Purpose This paper aims to examine whether increasing the salience of the internal auditor’s professional identity, defined by the expectations of their professional group, increases internal auditors’ judgments of the severity of internal control concerns when their organizational identity is high. Design/methodology/approach This paper tests the hypothesis using a laboratory experiment with internal auditors as participants. Findings The results support the hypothesis that professional identity salience moderates the relation between organizational identity and the assessed severity of identified internal control weaknesses. Increasing the salience of professional identity results in a more severe assessment of identified internal control weaknesses when organizational identity is high than when it is low. Originality/value Prior research in the lab and in the field provides mixed results about the impact of organizational identity on internal auditors’ judgments of the severity of identified internal control concerns. This paper contributes to the discussion on this issue. In addition, the results have implications for the debate about the benefits and costs of in-house versus out-sourced internal audit functions.

Risk management factors contributing to transgressions in the procurement practices in South African SOEs

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Lindani Myeza ◽  
Naledi Nkhi ◽  
Warren Maroun
Keyword(s):  
South Africa ◽  
Risk Management ◽  
Public Sector ◽  
South African ◽  
Public Procurement ◽  
African State ◽  
Political Influence ◽  
Structured Interviews ◽  
Content Type ◽  
Executive Level

PurposeThe study aims to deepen the understanding of why risk management principles are circumvented, thereby contributing to transgressions in public procurement for South African state-owned enterprises (SOEs). A deeper understanding of why risk management principles are circumvented is especially important in South Africa, given the high social, economic and environmental risks to which national and major SOEs are exposed in the procurement process.Design/methodology/approachThe study uses a qualitative design, based on detailed semi-structured interviews with 19 participants comprising management advisors, forensic investigators and auditors to explore why risk management principles are circumvented by South Africa SOEs.FindingsThe results of the study indicate that the tone that is set at political and executive level plays an important role in determining compliance with risk management principles by lower-level staff. Intense levels of political influence at SOEs are the main reason behind risk management systems being undermined.Originality/valueThe current study is one of the first explorations of why transgressions in public procurement continue to be evident despite risk management reforms being adopted by South Africa public sector. The research responds to the call for more studies on why reforms in South Africa public sector are not reducing transgression in public procurement. The study provides primary evidence on the importance of political and executive leadership in influencing the effectiveness of risk management reforms in the public sector.

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