Perceptions of justice as a catalyst for whistle-blowing by trainee auditors in South Africa

2015 ◽  
Vol 23 (1) ◽  
pp. 118-140 ◽  
Author(s):  
Faeeza Soni ◽  
Warren Maroun ◽  
Nirupa Padia
Keyword(s):  
South Africa ◽  
Quality Control ◽  
Audit Quality ◽  
Specific Reference ◽  
Justice Theory ◽  
Professional Literature ◽  
Content Type ◽  
Whistle Blowing ◽  
Junior Staff ◽  
Organisational Justice

Purpose – This study aims to use organisational justice theory to examine variations in the propensity of trainee auditors in South Africa to blow the whistle internally on misconduct by an engagement leader. Design/methodology/approach – Three vignettes describing high and low states of distributive, procedural and interactive justice are presented to a sample of trainee auditors. A questionnaire is used to gauge the likelihood of trainees blowing the whistle after taking into account a number of control variables. Preliminary results are analysed using parametric t-tests and one-way ANOVA’s. Findings – The study finds that the likelihood of trainee auditors reporting an engagement leader for misconduct increases when there is a high level of distributive, interactional and procedural justice. Gender, age, seniority, the importance of religion and performance ratings does not appear to have an effect on the propensity to whistle-blowing. Research limitations/implications – The growing importance of an effective mechanism for reporting malfeasance is reflected in both the academic and professional literature. Prior research has found that ensuring high levels of organisational justice is one means of promoting whistle-blowing in a professional setting. This paper argues that the same applies to trainee auditors. In turn, this suggests that audit firms wanting to implement sound audit quality control practices should be mindful of how their whistle-blowing policies are implemented and perceived by their junior staff. Originality/value – This paper is the first to apply organisational justice theory in a South African setting with specific reference to trainee auditors. As such, it makes an important contribution to the literature on whistle-blowing. The findings should also be of interest to the audit profession when seeking to implement effective quality control and monitoring systems, as required by the relevant professional standards.

Whistle-blowing by external auditors in South Africa

2014 ◽  
Vol 27 (5) ◽  
pp. 834-862 ◽  
Author(s):  
Warren Maroun ◽  
Jill Atkins
Keyword(s):  
South Africa ◽  
Corporate Governance ◽  
Audit Quality ◽  
Mandatory Reporting ◽  
Content Type ◽  
Whistle Blowing ◽  
External Auditors ◽  
Power And Control ◽  
And Control ◽  
African Setting

Purpose – The purpose of this paper is to explore how notions of disciplinary power manifest themselves in audit regulatory developments. When it comes to research on the relationship between audit quality and regulation, much of the prior scholarly work has kept to the positivist tradition of quantitative analysis under the guise of “economic rationality”. In contrast, this research takes an interpretive approach to provide an alternate and unique perspective, using motifs of Foucauldian power and control to illuminate the operation of external regulation in a South African setting. The paper examines what may be loosely described as a mandatory whistle-blowing duty imposed on external auditors. Design/methodology/approach – Detailed interviews with some of South Africa's leading corporate governance experts are used to highlight the disciplinary effect of an auditor's duty to bring reportable irregularities to the attention of an independent regulator. Findings – Blowing the whistle on irregularities contributes, not only to increasing the information made available to stakeholders, but to creating a valid expectation of auditors serving the public interest by enhancing a sense of transparency and accountability. Elements of resistance to panoptic-like control are, however, also present suggesting that, in part, the regulation may simply be creating the illusion of active reporting. Research limitations/implications – The research relies on a relatively small sample of subject experts and does not provide a complete account of regulatory developments taking place in South Africa and abroad. Additional research on the role of whistle-blowing in an external audit setting is needed focusing particularly on similarities and variations in interpretations of reporting by auditors from the perspective of more diverse stakeholder groups. Practical/implications – Mandatory reporting of irregularities by auditors can provided additional useful information for stakeholders and may contribute to demands for more effective reporting by auditors. Social implications – Arms-length regulation of the audit profession should not be seen only as a means of improving audit quality and the utility of audit reports. Powerful social forces are also. This research demonstrates how laws and regulations have a potential disciplinary effect on the audit profession that contributes to a restoration of confidence in the audit process after it is best by scandals, even if motifs of power and control are somewhat illusionary. Originality/value – This research addresses the need for more detailed analysis of precisely how mechanisms of accountability and transparency operate in the broader corporate governance arena. The paper also contributes to the calls for more detailed, context-specific studies of audit. Finally, this paper is one of the first to employ a critical theoretical perspective on audit in an African setting, responding to the need for contextual, methodological and theoretical eclecticism in the area of corporate governance research.

The evolving role of public libraries in South Africa in addressing information poverty

2018 ◽  
Vol 39 (6-7) ◽  
pp. 364-374
Author(s):  
Karla J. Strand ◽  
Johannes Britz
Keyword(s):  
South Africa ◽  
South African ◽  
Public Libraries ◽  
Professional Literature ◽  
Content Type ◽  
Doctoral Research ◽  
The People ◽  
History Of ◽  
Information Poverty

Purpose The purpose of this paper is to provide an overview of the historical development of libraries in South Africa against a backdrop of poverty and social inequality. In particular, this paper illustrates how the development of libraries in South Africa both reflected and influenced information poverty and has as its goal to increase awareness of the role of libraries in the alleviation of information poverty. Design/methodology/approach The information in this paper is based on doctoral research completed by the author who investigated the role of libraries in the alleviation of information poverty in South Africa. The methodology for the research included two case studies, interviews, examination of library records, and observation. An extensive review of the professional literature and recorded histories provided imperative context for that research and this paper. Findings Findings indicate that libraries can play an important role in the alleviation of information poverty in South Africa. Libraries are underutilized in this role and in order to increase their capacity in addressing information poverty, one should consider the historical circumstances behind the dispossession of library services. Understanding the development of libraries in South Africa and sociopolitical ramifications of this development can encourage and inform greater participation of libraries in the alleviation of information poverty in the future. Originality/value This paper compiles the work and findings of previous studies on the history of South African libraries. The information provided here offers an accessible and efficient history of libraries in South Africa. In so doing, it provides context that is invaluable to the understanding of how the development of libraries throughout time can have sociopolitical effects on the people and their circumstances. The paper also encourages increased understanding of the value and purpose of libraries in combating information poverty in South Africa.

scholarly journals Audit quality implications of regulatory change in South Africa

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Harina Ndaba ◽  
Michael Harber ◽  
Warren Maroun
Keyword(s):  
South Africa ◽  
Quantitative Research ◽  
Audit Quality ◽  
Field Work ◽  
Auditor Independence ◽  
Regulatory Change ◽  
Staff Retention ◽  
Audit Process ◽  
Content Type ◽  
External Regulation

PurposeThis paper explores how technical constructions of audit practice are influenced by mandatory audit firm rotation (MAFR) regulations. The paper responds to calls for additional research on how external regulation influences audit quality and supplements the predominately quantitative research dealing specifically with firm rotation and its relevance for audit quality.Design/methodology/approachData are collected from South Africa which is the latest jurisdiction to adopt MAFR (from 2017). Detailed interviews with 49 participants comprising 24 audit partners and 25 non-auditors are conducted to explore how MAFR can impact audit quality. For this purpose, audit quality is defined according to a schematic developed interpretively and based on professional auditing standards and the prior research on audit quality.FindingsThere is no guarantee that MAFR will bolster auditors' independence or contribute to a more thorough audit approach. On the contrary, the effort required by incoming audit firms to gain an understanding of new clients coupled with material tendering costs is expected to decrease the profitability of audit engagements with adverse implications for audit quality. A loss of client experience and staff retention challenges may contribute further to a decline in audit quality. There may be some improvements to audit practice when an incumbent firm's work is going to be scrutinised by a new auditor but audit methodologies, including the nature and extent of testing performed, are not expected to change significantly because of MAFR. In this way, the regulation may be a symbolic response to a perceived decline in audit quality and auditor independence rather than part of an effective strategy to encourage more rigorous audit practice for the benefit of the users of financial statements.Originality/valueThe current paper provides one of the first exploratory accountants of how MAFR is expected to impact audit practice and, in turn, audit quality. The research responds to the call for more field-work studies on the mechanics of the audit process by engaging directly with practitioners instead of relying on inferential testing of broad audit quality surrogates. The study also makes an important empirical contribution by providing primary evidence on how external regulation influences audit practice from a seldom studied African perspective.

The growth of the internal audit profession is more than just numbers

2015 ◽  
Vol 30 (6/7) ◽  
pp. 514-538 ◽  
Author(s):  
Philna Coetzee ◽  
Houdini Fourie ◽  
Pricilla A Burnaby
Keyword(s):  
South Africa ◽  
Quality Indicators ◽  
Audit Quality ◽  
Internal Audit ◽  
Chi Square ◽  
Content Type ◽  
Internal Auditors ◽  
Body Of Knowledge ◽  
Chi Square Test ◽  
Key Indicators

Purpose – The purpose of this paper is to investigate whether the internal audit quality was maintained in relation to the rapid growth in Institute of Internal Auditors (IIA) membership in South Africa. As The IIA in South Africa (SA) has seen more than double the membership growth (59 per cent) than the IIA (25 per cent) over the period 2006 to 2010, the change in internal audit quality indicators for these two are compared. Design/methodology/approach – The responses from SA respondents and all “Other” respondents are analysed from the 2006 and 2010 Common Body of Knowledge studies on specific questions addressing internal audit quality, to determine whether there is a growth in quality-related indicators and whether the growth is in relation to the membership growth. The chi-square test is used to look for change in response frequencies. Findings – The paper finds that the SA respondents have a greater increase of internal audit quality indicators than “Other” respondents, suggesting that the increase in membership could also result in improved internal audit quality. Originality/value – This study links the increase in membership with improved internal audit quality. This could assist the IIA in determining the feasibility of developing key indicators of internal audit quality. The IIA-SA will obtain an understanding whether the exceptional growth in membership is in line with the internal audit excellence as prescribed by SA guidance and legislation. Last, individual internal audit activities could benchmark their growth statistics against the SA and “Other” respondents’ growth pattern – both in numbers and quality indicators.

Does Part II of the PCAOB inspection report provide new information to the market?

2018 ◽  
Vol 33 (8/9) ◽  
pp. 715-735 ◽  
Author(s):  
William Buslepp ◽  
R. Jared DeLisle ◽  
Lisa Victoravich
Keyword(s):  
Quality Control ◽  
Market Share ◽  
Audit Quality ◽  
Content Type ◽  
The Public ◽  
Audit Market ◽  
New Information ◽  
Public Company ◽  
Public Signal ◽  
New Evidence

Purpose Part II of the Public Company Accounting Oversight Board (PCAOB) inspection report is released only when firms fail to remediate quality control criticisms and is intended to be a public signal of audit quality. The purpose of this paper is to reexamine whether audit clients react to the release of Part II of the PCAOB inspection report as a signal of audit quality. Design/methodology/approach This study uses a difference-in-difference regression model to examine the association between the release of Part II of the PCAOB inspection report and an audit firm’s change in market share. A sensitivity analysis is also performed to determine whether the main findings are robust to the timing of the release of the report and type of quality control criticism included in Part II of the inspection report. Findings After controlling for the prior year’s changes in market share, the authors find no evidence that clients react to the public release of Part II of the report. In the second part of the study, they examine when clients become aware of the contents of the Part II report prior to its release. Firms with audit performance criticisms experience a decrease in market share following the release of Part I. Firms with firm management criticisms experience a significant decrease in market share following the remediation period and before the public release of Part II. Practical implications The results suggest that Part II of the PCAOB inspection report does not provide new information to the market. Clients appear to be aware of the information contained in Part II of the PCAOB inspection report prior to its release. The authors believe that the delay in releasing the Part II report may create an information imbalance, and the PCAOB may want to consider ways to improve the timeliness of the information. Originality/value This study questions the generalizability of prior research which finds that Part II of the inspection report provides new information that is valued by the public company audit market as a signal of audit quality. The findings provide new evidence that the contents of Part II and the firm’s ability to remediate the quality control concerns are known to audit clients prior to the public release.

Marine water quality management in South Africa

1995 ◽  
Vol 32 (2) ◽  
pp. 281-288
Author(s):  
Susan Taljaard ◽  
Willem A. M. Botes
Keyword(s):  
South Africa ◽  
Water Quality ◽  
Quality Management ◽  
Water Quality Management ◽  
Management Plan ◽  
Specific Reference ◽  
Information Requirements ◽  
Water Quality Guidelines ◽  
Quality Guidelines ◽  
Beneficial Uses

In South Africa the ultimate goal in water quality management is to keep the water resources suitable for all “beneficial uses”. Beneficial uses provides a basis for the derivation of water quality guidelines, which, for South Africa, are defined in Water quality guidelines for the South African coastal zone (DWAF, 1991). The CSIR has developed a practical approach to marine water quality management, taking into account international trends and local experience, which can be applied to any coastal development with potential influence on water quality. The management plan is divided into three logical components, i.e. • site-specific statutory requirements and environmental objectives; • system design with specific reference to influences on water quality; and • monitoring programmes. Within this management approach water quality issues are addressed in a holistic manner, through focused procedures and clear identification of information requirements. This paper describes the procedures and information requirements within each component of the water quality management plan, with specific reference to marine disposal systems. Ideally, the management plan should be implemented from the feasibility and conceptual design phase of a development and the timing of the different procedures within the development process are therefore also highlighted. However, the logical lay-out of procedures allows for easy initiation (even to existing disposal system) at any stage of development.

KRiskSM: A Computerized Decision Aid for Client Acceptance and Continuance Risk Assessments

2002 ◽  
Vol 21 (2) ◽  
pp. 97-113 ◽  
Author(s):  
Timothy B. Bell ◽  
Jean C. Bedard ◽  
Karla M. Johnstone ◽  
Edward F. Smith
Keyword(s):  
Risk Management ◽  
Quality Control ◽  
Decision Aid ◽  
Audit Quality ◽  
Decision Aids ◽  
Risk Assessments ◽  
Innovative Technology ◽  
Full Potential ◽  
Business Risk ◽  
Client Acceptance

This paper describes the development and implementation of KRisk, an innovative technology-enabled auditor decision aid for making client acceptance and continuance risk assessments. KRisk, developed and designed by KPMG LLP, is part of the firm's audit quality control and risk management processes. In this paper, we discuss the environmental and technological forces that affect auditor business risk management. We also describe important aspects of the development, functionality, and implementation of KRisk. We discuss possible impediments to realizing the full potential of decision aids that have been reported in prior auditing research, and describe how KRisk and related audit quality control procedures implemented at KPMG were designed to overcome such impediments. Also, we present some ideas for scholarly research dealing with auditor business risk management issues, and issues related to the design and use of decision aids in general.

Climate change impacts on water resources in a rural community in Limpopo province, South Africa: a community-based adaptation to water insecurity

2020 ◽  
Vol 12 (5) ◽  
pp. 587-598
Author(s):  
Sejabaledi Agnes Rankoana
Keyword(s):  
Climate Change ◽  
South Africa ◽  
Water Resources ◽  
Water Supply ◽  
Rural Community ◽  
Limpopo Province ◽  
Community Based ◽  
Content Type ◽  
Adaptation Practices ◽  
Community Based Adaptation

Purpose The study explored the impacts of climate change on water resources, and the community-based adaptation practices adopted to ensure water security in a rural community in Limpopo Province, South Africa. Design/methodology/approach The study was conducted in Limpopo Province, South Africa. The participatory approach was used to allow community members to share their challenges of water scarcity, and the measures they have developed to cope with inconsistent water supply. Findings The study results show that the community obtains water for household consumption from the reticulation system supplied by Mutale River and the community borehole. These resources are negatively impacted by drought, change in the frequency and distribution of rainfall, and increased temperature patterns. The water levels in the river and borehole have declined, resulting in unsustainable water supply. The community-based adaptation practices facilitated by the water committee include observance of restrictions and regulations on the water resources use. Others involve securing water from neighbouring resources. Originality/value This type of community-based action in response to climate change could be used as part of rural water management strategies under climate change.

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