Disclosure Inconsistency of Audit Hours in Annual and Audit Reports and Economic Consequence of Firm

2020 ◽  
Vol 25 (2) ◽  
pp. 145-168
Author(s):  
Nam Chul Jung ◽  
Seok Woo Jeong
Keyword(s):  
Economic Consequence ◽  
Audit Reports

Timeliness of Tunisian Audit Reports: An Empirical Investigation based on Ownership and Partnership Visions

2015 ◽  
Vol 5 (3) ◽  
Author(s):  
Mondher Fakhfakh
Keyword(s):  
Empirical Evidence ◽  
Financial Reporting ◽  
Empirical Investigation ◽  
Financial Statements ◽  
Qualitative Feature ◽  
Transmission Delays ◽  
Emerging Country ◽  
Audit Reports ◽  
Audit Information

Timeliness of audit reports is a qualitative feature that enhances the usefulness of audited financial statements. As an emerging country, Tunisia has modernized its accounting legislation to enhance the quality of financial reporting. This legislation encourages independent auditors to optimize the transmission delays of audit reports. The authorities assume that the satisfaction of stakeholders is secured by regulating disclosure of audit reports. Our research analyses the date of issue of Tunisian audit reports and timeliness of audit information for shareholders and all users of financial statements (stakeholders). This paper provides new empirical evidence about the timeliness of audit reports in Tunisia. It holds two dates that influence the needs of users of financial statements: the date of signature of the auditors and the date of publication of the audit reports in the financial bulletin. The same article discusses the variability of the timeliness of audit reports and the factors that explain the delay information.

Does Auditor Explanatory Language in Unqualified Audit Reports Indicate Increased Financial Misstatement Risk?

2014 ◽  
Vol 89 (6) ◽  
pp. 2115-2149 ◽  
Author(s):  
Keith Czerney ◽  
Jaime J. Schmidt ◽  
Anne M. Thompson
Keyword(s):  
Financial Reporting ◽  
Reporting Quality ◽  
Positive Association ◽  
Financial Statements ◽  
Financial Statement ◽  
Financial Reporting Quality ◽  
Accounting Principles ◽  
Client Relationship ◽  
Financial Misstatement ◽  
Audit Reports

ABSTRACT According to auditing standards, explanatory language added at the auditor's discretion to unqualified audit reports should not indicate increased financial misstatement risk. However, an auditor is unlikely to add language that would strain the auditor-client relationship absent concerns about the client's financial statements. Using a sample of 30,825 financial statements issued with unqualified audit opinions during 2000–2009, we find that financial statements with audit reports containing explanatory language are significantly more likely to be subsequently restated than financial statements without such language. We find that this positive association is driven by language that references the division of responsibility for performance of the audit, adoption of new accounting principles, and previous restatements. In addition, we find that (1) “emphasis of matter” language that discusses mergers, related-party transactions, and management's use of estimates predicts restatements related to these matters, and that (2) the financial statement accounts noted in the explanatory language typically correspond to the accounts subsequently restated. In sum, our results suggest that present-day audit reports communicate some information about financial reporting quality.

How a Shared Auditor Affects Firm-Pair Comparability: Implications of Both Firm and Individual Audit Styles

2020 ◽  
Vol 39 (3) ◽  
pp. 133-160
Author(s):  
Lili Jiu ◽  
Bin Liu ◽  
Yuanyuan Liu
Keyword(s):  
Accounting Standards ◽  
Financial Statement ◽  
Professional Judgment ◽  
Audit Process ◽  
Personal Style ◽  
Audit Firm ◽  
Market Participants ◽  
Audit Firms ◽  
Audit Reports ◽  
Practical Implications

SUMMARY In this study, we examine the roles of audit firms and individual auditors in improving financial statement comparability. We conduct the study in the Chinese setting, in which the identities of signing auditors are revealed in audit reports and accounting standards are principle based. After controlling for audit firm style, we find that firm pairs with shared signing auditors have incrementally greater comparability. Our results indicate that individual auditors exhibit their own personal style in implementing accounting standards and exercising professional judgment in the audit process. Overall, our study underscores the association between individual auditors and comparability, with practical implications for market participants and policymakers.

Market Reactions to a High-Quality Auditor and Managerial Preference for Audit Quality

2019 ◽  
Vol 38 (4) ◽  
pp. 131-149 ◽  
Author(s):  
Patrick J. Hurley ◽  
Brian W. Mayhew
Keyword(s):  
Loss Aversion ◽  
Audit Quality ◽  
Data Availability ◽  
Quality Competition ◽  
High Quality ◽  
Market Reactions ◽  
Comprehensive Theory ◽  
Audit Reports ◽  
The Impact ◽  
Quality Theory

SUMMARY We insert an automated high-quality (HQ) auditor into established experimental audit markets to test the impact of high-quality competition on other auditors' supply of and managers' demand for audit quality. Theory predicts that managers will demand high levels of audit quality to avoid investors' price-protecting behavior. This demand should result in the HQ auditor dominating the market and increase other auditors' audit quality provision to compete with the HQ auditor. However, we find that the HQ auditor does not dominate the market—despite holding audit costs constant and investors placing a premium on HQ auditor reports. We also find that adding an HQ auditor results in other auditors lowering audit quality. Additional analyses indicate some managers demand lower audit quality to avoid negative audit reports, consistent with loss aversion as a potential explanation. Our findings indicate a need to develop a more comprehensive theory of the demand for auditing. Data Availability: The laboratory market data used in this study are available from the authors upon request.

Design and Application Research of Audit Risk Control Program

2013 ◽  
Vol 310 ◽  
pp. 718-721
Author(s):  
Li Ya Ma ◽  
Shu Feng Wang
Keyword(s):  
Risk Model ◽  
Risk Control ◽  
Control Program ◽  
Audit Report ◽  
Audit Risk ◽  
Specific Content ◽  
Auditing Standards ◽  
Audit Reports ◽  
Independent Auditing ◽  
And Control

Strict procedures for prevention and control of audit risk is one of the most effective measures, so the research on design of audit risk control standardization program has very great practical application value. Combined with the research needs, the CPA practices respectively utilize means of summarizing method, for example, analysis method and enumeration method. The CPA practice also revealing the audit risk and audit report risk associated with different basis, combining with the traditional audit risk model. The specific content concludes the report of audit risk and then designs including audit reports preparation, audit draft, final review report to track a feedback of visit to the control standard operating requirements, and then puts forward the independent auditing standards. The auditing standards should be added to the proposal of audit report program.

Accounting Reliability Concept: Audit Practices

Auditor ◽  
2021 ◽  
pp. 33-39
Author(s):  
Zoya Boginskaya ◽  
Tatyana Gladkova
Keyword(s):  
Financial Statements ◽  
Audit Reports ◽  
The Impact

Practical aspects of applicable concepts for the preparation of reliable financial statements are analyzed, in particular, an overview and analysis of typical errors encountered in the practice of auditing accounting statements. Theoretical aspects of qualification and interpretation of errors in relation to changes of relevant documents regulating audit are considered; a list of typical errors made during the preparation of financial statements for 2018-2020 is indicated; the actions of the auditor in relation to the identified errors are formulated; analysis of the impact of errors on the auditor’s opinion on the reliability of accounting statements in audit reports.

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