Effects of the Covid-19 Pandemic Estimated in the Financial Statements and the Auditor`s Report

2021 ◽  
Vol 19 (161) ◽  
pp. 105-118
Author(s):  
Andreea Claudia CRUCEAN ◽  
◽  
Camelia-Daniela HATEGAN ◽  
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Financial Statements ◽  
Point Of View ◽  
Annual Reports ◽  
Statistical Point ◽  
Going Concern ◽  
Business Interest ◽  
Available Resources

The COVID-19 pandemic had a significant impact on all aspects of life, but also on the financial reporting of companies and on the activity of auditors. The paper aims to highlight the importance of reporting in the financial statements the subsequent events caused by the COVID-19 pandemic, but also of the aspects that can significantly influence the going concern of companies' activities, respectively how these effects can cause changes in the quality of audit services. The study was conducted on a sample of 60 companies listed on the Bucharest Stock Exchange, analyzing the components of the annual reports for the financial year 2019, namely the financial statements, the administrator's report and the independent auditor's report. The results showed that the effects generated by the COVID-19 pandemic had a significant impact in most of the industries studied, affecting both companies to carry out activities by closing borders, reducing or even closing certain activities, stopping travel and hindering communication with suppliers, customers or investors, reduced sales, deferred payments or the need to optimally manage costs and available resources, as well as at the level of employees by performing work at home, technical unemployment or salary reductions, but also at the level of the client-auditor relationship, by limiting travel in business interest. Most of the estimated effects of the pandemic were presented in the administrator's report, some of the effects being mentioned in the explanatory notes to the financial statements. From a statistical point of view, the companies' declaration of the effects of the pandemic was correlated with the size of the auditor, the opinion issued by him and the average number of employees. The study showed that certain auditors assessed the risks posed by subsequent events reported by companies, presenting insignificant uncertainties in some cases, but also significant uncertainties regarding the going concern of the activity of some companies.

scholarly journals FACTORS INFLUENCING THE QUALITY OF FINANCIAL AUDIT

2019 ◽  
Vol 4 (2) ◽  
pp. 7-15
Author(s):  
Camelia-Daniela Hategan
Keyword(s):  
Financial Reporting ◽  
Audit Quality ◽  
Stock Exchange ◽  
Financial Statements ◽  
Quality Factors ◽  
Financial Reports ◽  
Energy Field ◽  
Auditor Rotation ◽  
Financial Audit

Investors’ decisions are based on financial and non-financial information. To be useful, the information provided by the financial reports must be accurate, which is also ensured by the opinion expressed by the auditors. The purpose of the paper is to show the importance of the quality of audit services both for investors and for professional accountants and auditors. Audit quality factors can be structured according to several criteria and were represented by the size of the auditor, rotation, duration of the contract, types of services provided. In order to support this hypothesis, the correlation between the variables was tested on the basis of a sample of seven companies listed at Bucharest Stock Exchange in the energy field and utilities included in index BET, for period 2013 - 2018. The data was collected from the annual financial statements and reports issued by financial auditors. The results show that there is a correlation between variables, but of different intensities depending on the indicators chosen. Increasing the quality of financial reporting and the quality of audit leads to increased investor confidence in professional accountants.

Empirical Study on the Effect of Adopting the International Financial Reporting Standards (IFRS) on the Quality of Earnings using Beneish Model in a Sample of Banks Listed in the Iraqi Stock Exchange

2021 ◽  
Vol 39 (11) ◽  
Author(s):  
Zahraa Nasser Ali ◽  
Hakeem Hammood Flayyih
Keyword(s):  
Financial Reporting ◽  
Commercial Banks ◽  
Stock Exchange ◽  
Financial Statements ◽  
International Financial Reporting Standards ◽  
Reporting Standards ◽  
Global Capital ◽  
Financial Reporting Standards ◽  
The Impact

The need for international financial reporting standards (IFRS) emerged due to the increasing degree of interdependence between global capital markets and the need for investors to obtain reliable and honest financial information in expressing economic events, in order to find a common financial language, and this is what IFRS provide. Nevertheless, the research aimed to measure the impact of the adoption of IFRS on the quality of earnings in the Iraqi banks listed in the Iraqi Stock Exchange for a sample of 30 banks. The Beneish model was used to measure the quality of earnings, while Mann-Whitney was used to measure and prove the hypothesis of the research. However, the research reached a set of conclusions, including that although the IFRS should contribute to improving the quality of financial reporting, the adoption of these standards in commercial banks listed in the Iraq Stock Exchange did not contribute to achieving quality in earnings even after adopting those standards. Furthermore, a Beneish model is an important tool for auditors, financial analysts, investors, and creditors who have the ability to understand the financial statements or those who have a reasonable understanding of the nature of those financial statements in measuring the quality of earnings, because it is a simple and easy to implement tool.

scholarly journals ANALISIS PENGARUH FRAUD PENTAGON DALAM MENDETEKSI FRAUDULENT FINANCIAL REPORTING PADA PERUSAHAAN JASA NONKEUANGAN

2020 ◽  
Vol 12 (1) ◽  
pp. 104-124
Author(s):  
Yuliamos Tirta Wijaya Pasaribu ◽  
Synthia Madya Kusumawati ◽  
L. Jade Faliany
Keyword(s):  
Financial Reporting ◽  
Financial Stability ◽  
Stock Exchange ◽  
Secondary Data ◽  
Financial Statements ◽  
External Pressure ◽  
Annual Reports ◽  
Fraudulent Financial Reporting ◽  
Service Companies ◽  
Positive Effect

Abstract– This research aimed at analyzing the effect of fraud pentagon proxied by nine variables, namely financial stability, personal financial needs, external pressure, financial targets, ineffective monitoring, industry characteristics, auditor changes, director changes, and frequent number of CEO’s picture towards fraudulent financial reporting proxied by Beneish M-Score at non-financial service companies listed on the Indonesia Stock Exchange (IDX) period 2015-2017. The data used were secondary data obtained from annual reports and financial statements of nonfinancial service companies period 2015-2017 with a total of 285 eligible samples. The data analysis methods used were descriptive statistical analysis and logistic regression analysis. The results showed that the variables of financial stability and the nature of the industry generated a significant and positive effect on fraudulent financial reporting. Meanwhile, the variables of personal financial needs, external pressure, financial targets, ineffective monitoring, auditor changes, director changes, and often the CEO's image were not significant to fraudulent financial reporting. Keywords: Fraud Pentagon, Fradulent Financial Reporting, Beneish M-Score

scholarly journals Global Impact of COVID 19 on the Concept of “Going Concern”

2021 ◽  
Vol 92 ◽  
pp. 01045
Author(s):  
Kameliya Savova
Keyword(s):  
Financial Reporting ◽  
Basic Concept ◽  
Systematic Approach ◽  
Stock Exchange ◽  
Value Added ◽  
Financial Statements ◽  
Key Factors ◽  
Global Impact ◽  
Going Concern ◽  
Economic Nature

Research background: The article presents a problem in the field of financial reporting. “Going concern” is the basic concept and principle in the preparation of the financial statements of enterprises. Purpose of the article: The purpose of this article is to present the global impact of COVID 19 on the concept of “going concern”, which is used as a basis for the development of the financial statements of the companies. The essence of the “going concern” concept is clarified. The key factors provoking a crisis in the capital cycle of the enterprises and possible scenarios of manifestation of a “going concern” in conditions of uncertainty are presented. Methods: The research methodology is based on a systematic approach with appropriate methodological tools for analysis, generalization, and graphic visualization of the achieved results. Empiric research of the information on revenues, profitability, and net cash availability of non-financial enterprises - issuers on the Bulgarian Stock Exchange was conducted, based on published interim financial statements for the first quarter of 2020. Findings & Value added: The content of the research is useful for potential investors who are interested in non-financial companies - issuers on the Bulgarian Stock Exchange. It provides important knowledge into understanding the economic nature of the ‘going concern’ concept applied in the globalizing economy as a basis for preparing financial statements.

scholarly journals NON-DISCLOSURE OF FINANCIAL STATEMENTS OF PUBLIC COMPANIES AS AN ECONOMIC OFFENSE IN THE REPUBLIC OF SERBIA

2021 ◽  
Vol 25 (3) ◽  
Author(s):  
Marija Kostić ◽  
Vule M. Mizdraković ◽  
Vladimir Mitić
Keyword(s):  
Financial Reporting ◽  
Stock Exchange ◽  
Financial Statements ◽  
Legal Framework ◽  
Timely Manner ◽  
Public Companies ◽  
Official Gazette ◽  
Time Period ◽  
The Republic

The successful functioning and development of the capital market, along with the possibility of attracting new investments is largely contingent on the quality of financial reporting and the availability of the statements themselves. In view of the fact that the new Law on Accounting of the Republic of Serbia came into force, the question arises to what extent public companies respect legally prescribed deadlines for submitting their statements and by doing so do not commit an economic offense. The primary goal of this paper is to draw attention to the importance of a standardized and efficient legal framework that obliges public companies to publish financial statements in a timely manner. A survey was conducted that encompassed 416 public companies listed on the Belgrade Stock Exchange and their corresponding financialstatements for 2018, as the reporting period. We tried to establish whether the sampled companies disclosed their statements within the deadline prescribed by the Law on Accounting (Law on Accounting, Official Gazette of RS, 62/2013, 30/2018). The results show that most companies disclosed financial statements during the period when they are still considered useful to potential and existing investors. Nevertheless, practice showed that there was room for improvement, and this was achieved with the adoption of the new Law on Accounting, which took effect on January 1, 2020. It integrates the deadline for compiling and disclosing statements, which in fact shortens the time period during which information on the companies’ operations should be made available to the general public and potential investors.

scholarly journals ANALISIS UKURAN PERUSAHAAN DAN PELUANG INVESTASI DI MASA DEPAN TERHADAP KUALITAS LABA PERUSAHAAN

2020 ◽  
Vol 7 (2) ◽  
pp. 117-125
Author(s):  
R. Aditya Kristamtomo Putra
Keyword(s):  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Financial Statements ◽  
Multiple Linear Regression Analysis ◽  
Annual Reports ◽  
Manufacturing Companies ◽  
Investment Opportunity ◽  
Process Data ◽  
Investment Opportunity Set

This research aims to test, analyse and explain the influence of corporate assets and Investment Opportnity Set to profit. The method used in this research is a descriptive method of verifiable with a quantitative approach that is sourced from financial statements and annual reports in various industry sector manufacturing companies listed on the Indonesia Stock Exchange period 2013-2018. Sampling techniques using the purposive sampling method. The Data obtained is analyzed by classical assumption test testing, multiple linear regression analysis and hypotheses test using T test and F test. This research uses SPPS version 25 program to process data. The results showed that the company asset has significant effect on the profit and investment opportunity set has no effect on the quality of profit while simultaneously the company size and investment opportunity set does not affect the quality of profit

scholarly journals FRAUDULENT FINANCIAL REPORTING: A PENTAGON FRAUD ANALYSIS

2019 ◽  
Vol 16 (2) ◽  
pp. 122-134
Author(s):  
Satria tri Nanda ◽  
Neneng Salmiah ◽  
Dina Mulyana
Keyword(s):  
Financial Reporting ◽  
Financial Stability ◽  
Stock Exchange ◽  
Secondary Data ◽  
Financial Statements ◽  
Annual Reports ◽  
Manufacturing Companies ◽  
Fraudulent Financial Reporting ◽  
Financial Reports ◽  
Fraudulent Financial Statements

Financial statements describe the company's financial condition. There are many gaps in the financial reports that enable management to commit fraudulent financial reporting. This study purpose to analyze the pentagon fraud, namely the pressure that is proxied by the financial target, the opportunity that is proxied by the effectiveness of monitoring (ineffective monitoring); Rationalization which is proxied by change in auditor; Competence which is proxied by the change of company directors; and Arrogance which is proxied by the number of CEO images that appear (number of CEO's picture), detects fraudulent financial statements measured using the Altman Z Score. The sample used in this study were 24 pharmaceutical sub-sector manufacturing companies registered on the Indonesia Stock Exchange during the period 2015 until 2017. The type of data used is secondary data obtained from annual reports and company financial statements for the 2015-2017 period. The analysis of the data used is multiple regression using the SPSS version 16. This study found that financial stability and ineffective monitoring influence fraudulent financial statements. Whereas auditor turnover, change of directors and the number of CEO photos that appear do not affect fraudulent financial statements.

Antecedents to the Audit Quality of Non-Financial Firms Listed in Iraq Stock Exchange: The Moderating Role of Accounting Fairness

2021 ◽  
Vol 39 (11) ◽  
Author(s):  
Asaad Mohammed Ali Wahhab ◽  
Abbas Murad Khnaitel Alzubadi Alzubadi ◽  
Ali Shakir Mahmood Haddad
Keyword(s):  
Financial Reporting ◽  
Audit Quality ◽  
Stock Exchange ◽  
Reporting Quality ◽  
Financial Reporting Quality ◽  
Earning Management ◽  
Going Concern ◽  
Financial Firms ◽  
Audit Fee

The main objective of the current study is to examine audit fee, financial reporting quality, going concern, and earning management as antecedents to the audit quality of non-financial firms listed in Iraq stock Exchange. In addition to that the study has also examined the moderating role of accounting fairness in the relationship between audit fee, financial reporting quality, going concern, earning management and audit quality of non-financial firms listed in Iraq stock Exchange. The data of 60 firms listed on Iraqi stock exchange over the period of 4 years from 2017-2021 is taken from the audited accounts. The study basically employs panel data analytical tools in achieving the set goals of the research. The choice of panel data approach is informed by a number of methodological advantages it offers. Results indicates that that as interest in the agency theory grows, the importance of fairness as a principle will grow, and that it is expected that the value of this concept would grow as a means of resolving conflict and exploiting interests that arise between the many stakeholders in the firm. on the concept of fairness, agreeing that the interests of particular parties should not trump fairness, which he referred to as clarity. The results of the study have provided support to the hypothesis of the study. The findings of the study will be helpful for policymakers, and researchers on the issues related to accounting fairness ,audit fee, financial reporting quality, going concern, earning management and audit quality of non-financial firms listed in Iraq stock Exchange.

scholarly journals Evaluation of the quality of the media content of reports and financial statements published electronically in the Khartoum Stock Exchange from the perspective of investors: تقييم جودة المحتوى الإعلامي للتقارير و القوائم المالية المنشورة الكترونياً في سوق الخرطوم للأوراق المالية من وجهة نظر المستثمرين

2017 ◽  
Vol 1 (3) ◽  
Author(s):  
Fateh AlIlah Mohamed Ahmed Mohamed Mohamed Saad Obeid Mohame
Keyword(s):  
Stock Exchange ◽  
Accounting Information ◽  
Financial Statements ◽  
Point Of View ◽  
Securities Market ◽  
Electronic Dissemination ◽  
Degree Of Confidence ◽  
The Media ◽  
Qualitative Characteristics

The study dealt with the electronic dissemination of information accounting in capital markets in developing countries, where the study aimed to assess the quality of the content of accounting information contained in the reports and the financial statements published electronically in Khartoum Securities Market  from the point of view of investors through the statement of the availability of qualitative characteristics of accounting information, the degree of confidence of investors in the accounting information contained in the reports and the financial statements published electronically. To achieve those purposes a questionnaire has been prepared to collect data from investors in Khartoum Securities Market. The study sample consists of (90) investors. The main findings of the study are that: high availability of qualitative characteristics of accounting information in the reports and financial statement published electronically, and investors in Khartoum Securities Market have high confidence in content of accounting information disseminated electronically.

scholarly journals Effect of Audit Committee Tenure on Financial Reporting Quality of Listed Deposit Money Banks in Nigeria

2018 ◽  
Vol 14 (4) ◽  
pp. 257
Author(s):  
Joseph Majiyebo Onyabe ◽  
Joshua Okpanachi ◽  
Terzungwe Nyor ◽  
Onipe Adabenege Yahaya ◽  
Mohammed Ahmed
Keyword(s):  
Financial Reporting ◽  
Audit Committee ◽  
Stock Exchange ◽  
Reporting Quality ◽  
Financial Statements ◽  
Financial Reporting Quality ◽  
Cross Sectional ◽  
Correlation And Regression Analysis ◽  
The Mean

This study examines the effect of audit committee tenure on financial reporting quality of listed deposit money banks in Nigeria. The study uses panel data obtained from the Nigerian Stock Exchange factbooks and the financial statements of 14 listed deposit money banks over a period of 10 years (2007-2016). The study uses cross sectional and time series research design. Financial reporting quality was measured using the modified Jones (1991) model and changes in working capital model, while audit committee tenure was measured as the mean tenure of audit committee members. The data was analyzed using descriptive (mean, standard deviation, minimum and maximum) and inferential statistics (correlation and regression analysis). The study reveals that audit committee tenure has a negative and insignificant effect on financial reporting quality under the two models. The implication of these results is that the tenure of audit committee members is not important when considering the financial reporting quality of deposit money banks in Nigeria. The study therefore concludes that the effect of audit committee tenure on financial reporting quality of deposit money banks in Nigeria is negative and insignificant. Based on this conclusion, the study recommends that further research should be conducted on other audit committee attributes in order to see which of the attributes may have significant effect on financial reporting quality.

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