Download or read book Conceptualising Balanced Reliance on Internal Audit Work by External Auditors written by Marianne Van Staden and published by . This book was released on 2020 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Reliance refers to the incorporation of internal audit work into audit evidence during statutory external audits. Inappropriate reliance undermines audit effectiveness and quality while fair reliance enhances audit efficiency. Reliance is complex, implementation problems are common and academic knowledge gaps prevail. Consequently, the research question of this study is formulated as follows: How can reliance on internal audit work by external auditors be conceptually explained, considering the reciprocal influences of the roles, interpretations, interests and practices of management, the audit committee and internal and external auditors? Responding to the research question, the major contribution of this study is the substantive theory of balanced reliance, explaining how management, the audit committee and internal and external auditors overcome disconnect between their reciprocal influences on reliance to achieve mutual agreement that reliance is appropriate and fair, balanced, whatever the reliance decision. The study is based on the classic grounded theory methodology of Glaser and Strauss (1967) and was implemented in three phases: Phase 1: Theoretical sampling included 32 interviews. Five key data sets (22 initial and three follow-up interviews) represented five diverse South African listed companies. Each data set comprised data from the key audit stakeholder groups of the company, namely, the chief financial officer, audit committee chair, chief audit executive and external audit engagement partner. A further data set of seven interviews involved other knowledgeable audit professionals. Joint data collection, open coding and analysis identified the main concern aÌ2Ë60́9 the disconnect between the stakeholder groupsaÌ22́Ơ4́Ø reciprocal influences on reliance aÌ2Ë60́9 and the core category (achieving mutual agreement that reliance is appropriate and fair (balanced), whatever the reliance decision. Phase 2: Joint theoretical sampling, selective and theoretical coding and analysis saturated the substantive categoriesaÌ22́Ơ4́Ø properties and relationships. Phase 3: Theoretical sorting and writing delimited the substantive categories into theoretical constructs, explaining the substantive theory. Comparisons indicated how the substantive theory broadened and transcended extant knowledge. The substantive theory of balanced reliance developed in this study explains how the stakeholder groupsaÌ22́Ơ4́Ø willing reciprocal synchronisation resolves disconnect between the stakeholder groupsaÌ22́Ơ4́Ø roles, interpretations, interests and practices influencing reliance. This, in turn, renders viable their mutual agreement that reliance is appropriate and fair (balanced), whatever the reliance decision. With reciprocal synchronisation as a foundation, a voluntarily formed team mindset is the predominant mediator of habitual integration and fair alignment of internal and external audit work. These co-variant conditions change stakeholder groupsaÌ22́Ơ4́Ø mutual agreement from being viable to practicable, as the disconnect between internal and external audits is resolved. Stakeholder groupsaÌ22́Ơ4́Ø participation in facilitative communication and a strong audit committeeaÌ22́Ơ4́Øs balancing oversight create the context for sustaining stakeholder groupsaÌ22́Ơ4́Ø mutual agreement that reliance is appropriate and fair (balanced), whatever the reliance decision.

Download or read book Cutting Edge Internal Auditing written by Jeffrey Ridley and published by John Wiley & Sons. This book was released on 2008-04-30 with total page 486 pages. Available in PDF, EPUB and Kindle. Book excerpt: Cutting Edge Internal Auditing provides guidance and knowledge for every internal auditor, encouraging each to pioneer new ground in the development of their professional practices in all risk management, control and governance processes. Serving as an excellent reference guide that develops a pattern of internal auditing now and for the future, this book explores the concept of 'cutting edge' internal auditing as an imaginative adventure: demonstrating how this has influenced and will continue to influence the development of professionalism in internal auditing. Built on the foundations of Jeffrey Ridley's extensive internal auditing experience across the public and private sectors, the author uses his articles and research to explore and develop the motivations, goals and categories of innovation in internal auditing today. It develops and brings up to date an imaginative internal auditing model, created and used by the author in the early 1980s, drawing on research and guidance by The Institute of Internal Auditors Inc., its Research Foundation and the Institute of Internal Auditors - UK and Ireland. Each chapter stands alone by focusing on an individual internal auditing theme, considered from both the perspective of internal auditing and its customers to suggest an appropriate vision as a goal for every internal audit activity. Each chapter also includes self-assessment questions to challenge the readers understanding of its messages. Companion website contains some of the author's training slides and seventy case studies, many written by leading internal audit practitioners, this book creates a vision for future cutting edge internal auditing.

Download or read book An Empirical Study of External Auditor Reliance on Internal Auditors written by Loren Louis Margheim and published by . This book was released on 1984 with total page 144 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Reliance of External Auditors on Internal Audit s Use of Continuous Audit written by Irina Mălăescu and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: As a response to the increased demand for timely and ongoing assurance over the effectiveness of risk management and control systems, companies are moving towards a more automated control environment through the implementation of continuous audit modules. The purpose of this study is to evaluate external auditors' reliance on internal audit's work when advanced audit techniques are introduced by the internal auditor and the impact this reliance has on budgeted audit hours. Prior literature suggests that internal control deficiencies also have an impact on external auditor reliance and the audit budget. The reliance decision of an external auditor has important economic consequences and implications for efficiency and effectiveness of the overall audit. In recent years, the PCAOB has encouraged greater such reliance to improve audit efficiency. An experiment is conducted with 87 experienced external auditors to investigate the theorized effects. Using a 2 x 2 between subjects factorial design, the frequency of the internal audit (traditional vs. continuous audit) and prior year material weakness (absent vs. present) are manipulated. Consistent with predictions, we find that auditors are willing to rely more on internal audit work in a continuous audit environment than in a traditional environment, and this effect is magnified when the prior year audit report on the effectiveness of internal controls indicates that controls are working properly. The presence of a material weakness, however, negatively impacts judgments on the budget for the valuation of a complex account. In addition, both material weakness and continuous audit have an impact on the overall audit budget, which is reduced only when the company has no prior year material weakness and a functioning continuous audit module is put in place. The results show that auditors increase budgeted hours for the engagement at a higher rate when the client uses traditional internal audit procedures.

Download or read book Internal Audit Practice from A to Z written by Patrick Onwura Nzechukwu and published by CRC Press. This book was released on 2016-11-25 with total page 675 pages. Available in PDF, EPUB and Kindle. Book excerpt: Internal Audit Practice from A to Z addresses the practice of internal auditing using GAAS (Generally Accepted Auditing Standards), GAGAS (Generally Accepted Government Auditing Standards) and International Standards for the Professional Practice of Internal Auditing (Standards)-IPPF, International Standards Organization (ISO), International Standards of Supreme Audit Institutions (ISSAI), International Standards on Auditing (ISA) as enunciated by the Institute of Internal Auditors (IIA), International Organization of Standardizations (ISO), International Organization of Supreme Audit Institutions (INTOSAI), Government Accountability Office (GAO) & International Federation of Accountants (IFAC). Unique in that it is primarily written to guide internal auditors in the process and procedures necessary to carry out professionally accepted internal audit functions, the book includes everything necessary to start, complete, and evaluate an internal audit practice, simplifying the task for even non-professionals. Internal Audit Practice from A to Z features A rich array of forms, figures, tables, and reports, making it a practical, hands-on book Provides comprehensive content that contains all the practical guidance necessary to start, complete, and evaluate an internal audit practice Details on how to ensure quality on internal audit function through peer review Current international standards for the professional practice of internal auditing and other relevant standards for reference Checklists for all practice procedures as well as a checklist of the internal control of virtually all aspects of business function A blend of professional practice with theory. Internal Audit Practice from A to Z is comprehensively rich, global reference is a must for public, private, NGOs, institutions—every organization.

Download or read book External Auditors Reliance on Internal Auditors Work written by D. Dewey Ward and published by . This book was released on 1979 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book External Auditor s Reliance on Internal Auditing written by Ray Duane Barr and published by . This book was released on 1953 with total page 188 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The External Auditor s Reliance Decision on the Internal Audit Function written by Tina Youngblood Mills and published by . This book was released on 19?? with total page 186 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book A Delphi survey of reliance upon internal auditors and their work of external auditors during financial audits written by Dalton Dewey Ward and published by . This book was released on 1979 with total page 734 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Internal Audit Sourcing Arrangement and the External Auditor s Reliance Decision written by Steven M. Glover and published by . This book was released on 2007 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the effects of internal audit sourcing arrangement on the external auditor's reliance decision in the presence of different levels of inherent risk and task subjectivity. We posit that external auditors will rely more on outsourced than in-house internal audit functions (IAFs) and that this difference will be more pronounced when inherent risk is high or when the work performed by internal auditors relates to a subjective task. Participants in the study were 127 external auditors from a Big 4 firm who completed an experimental case in which we manipulated internal audit sourcing, inherent risk, and task subjectivity. Results from the experiment indicate an interaction between sourcing and inherent risk such that external auditors rely more on outsourced than in-house internal auditors when the level of inherent risk is high but do not differentiate based on sourcing arrangement when inherent risk is low. While we find that reliance is lower for subjective than for objective tasks, we do not find an interaction between sourcing arrangement and the subjectivity of the work performed. We do find a marginally significant interaction between inherent risk and subjectivity of work performed: external auditors are less willing to rely on subjective work performed by internal auditors when inherent risk is high but do not differentiate based on task subjectivity when inherent risk is low. Additional analyses indicate that sourcing arrangement affects the reliance decision both directly and indirectly. The indirect effect appears to be mediated through external auditors' perceptions of internal auditor objectivity.

Download or read book External Auditor Reliance on Internal Auditors written by Perry Glen Moore and published by . This book was released on 1992 with total page 284 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Relationship Between External and Internal Auditors written by Cecilia Young and published by . This book was released on 1989 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: The primary purpose of this study was to survey the accounting and auditing literature concerning the relationship between the internal and independent auditors and how they can work together. Statement on Auditing Standards (SAS) No. 9 states that independent auditors must evaluate internal auditors on competence, objectivity, and performance of work, but only provides very general and ambiguous guidelines. Two studies were examined to further define the characteristics stated in SAS No. 9. Competence was found to be related to the internal auditors' experience, education, and supervision. Objectivity required independence of internal auditors, adequate scope of departmental audits, and a high reporting level within the organization. Performance of work was based on quantity and quality of supervision within the internal audit department and the support from top management. The secondary purpose was to develop guidelines for reliance on internal auditors by external auditors. Four areas were found where reliance can be expanded. These areas are: testing of internal controls, preparation of workpapers, EDP auditing, and audit follow-up. The testing of internal controls can include more direct assistance in compliance testing of the system. Internal auditors may prepare workpapers prior to the financial audit. Internal auditors may also assist with EDP auditing because of their familiarity with the system. Finally, the role of internal auditor may be expanded to include audit follow-up.

Download or read book External Auditors Reliance on Internal Audit Functions written by Zorita Haji Ahmad and published by . This book was released on 1995 with total page 130 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Relation Between Internal Auditors and External Auditors written by Cynthia Merhej and published by . This book was released on 2013 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: External auditors are auditors ensuring that the financial statements are free from material misstatements. However internal auditors focus on the company itself; where they are employees in most of the cases. Based on extensive literature review, we extracted the cornerstone for a good relation between both internal and external auditors. Auditors should be independent, objective, competent, having professional skepticism to gain management confidence and third party confidence. Collaboration between auditors enhances information reliability and control efficiency. Furthermore, collaboration between auditors reduces the effect of agency theory and facilitates communication between the principal and the agent. This project elaborates the relation between internal and external auditors, in Lebanon. We defined the factors that contribute to build up a trust relation and successful cooperation between internal and external auditors as well as the prevalent conditions for collaboration. To answer the previous issues we asked fifty auditors to complete questionnaires related to their academic knowledge and their experimental awareness. Forty five auditors responded our needs. The quantitative approach used, allowed us to conclude that, in Lebanon, the relation between internal and external auditors is fair. External auditors rely on internal auditors' work. However, internal auditors do not rely on the work of external auditors yet they use those latter works to validate and ensure their results. We can conclude, as well, from our work that auditors' independence, objectivity, competence and professional experience encourage trust between both internal and external auditors. In plus, we can consider that trust is based on cooperation endorsed by management and audit committee, professional confidence, internal audit competence, and effective communication between auditors. To add, holding periodic meeting, scheduling audit work, providing access to internal auditors' working papers, discussing possible accounting and auditing techniques, and using similar techniques and methodologies strengthen coordination between internal and external auditors.

Download or read book Internal Audit Quality written by Sally-Anne Pitt and published by John Wiley & Sons. This book was released on 2014-09-29 with total page 405 pages. Available in PDF, EPUB and Kindle. Book excerpt: Deliver increased value by embedding quality into internal audit activities Internal Audit Quality: Developing a Quality Assurance and Improvement Program is a comprehensive and authoritative guide to better practice internal auditing. Written by a global expert in audit quality, this guide is the first to provide complete coverage of the elements that comprise an effective internal audit quality assurance and improvement program. Readers will find practical solutions for monitoring and measuring internal audit performance drawn from The IIA's International Standards for the Professional Practice of Internal Auditing, and complemented by advice and case studies from leading audit practitioners from five different continents. Major corporate and financial collapses over the past decade have challenged the value of internal audit. With an increased focus on internal audit's role in good governance, management is increasingly demanding that internal audit provides assurance of the quality of its own activities. The IIA standards provide a framework for audit quality in the form of mandatory guidance . Recent research indicates that the majority of internal audit functions do not fully comply with the standards and, as a result, are not servicing the needs of their organizations as well as they might. Internal Audit Quality offers a roadmap to internal audit quality, providing readers the guidance they need to: Embed quality into all elements of internal audit from strategic and operational planning down to day-to-day tasks Create well-defined internal audit programs and procedures Independently self-assess internal audit quality and performance Conform with the IIA standards and better practice Provide assurance over internal audit efficiency and effectiveness Deliver value by meeting stakeholder expectations As a key component of good governance, internal audit is on the rise. The days of retrospective, compliance-focused auditing is a thing of the past. Organizations expect more of internal audit, and many internal audit activities are accepting the challenge. Rather than relying on audit supervision and external assessments, modern auditors are embedding quality into audit activities to create effective programs. For the auditor looking to distinguish themselves as leading edge, Internal Audit Quality provides the guidance that enables the right work, at the right time, in the right way.

Download or read book The Internal Auditor at Work written by K. H. Spencer Pickett and published by John Wiley & Sons. This book was released on 2004-02-10 with total page 303 pages. Available in PDF, EPUB and Kindle. Book excerpt: A clear, accessible guide to the roles and responsibilities of today's internal auditor At a time when companies are seeking to reevaluate their practices and add value to their audit processes, The Internal Auditor at Work represents an invaluable, user-friendly, and up-to-date guidebook for the internal auditing professional to refine and rethink both day-to-day methods and the underlying significance of the job. Each chapter of this in-depth, functional analysis contains numerous resources to guide the reader toward greater understanding and performance. Discussion questions promote dialogue among auditing professionals on the various topics covered. Top ten considerations lists recap the important points of each chapter. And end-of-chapter exercises are especially valuable to new internal auditors in that they facilitate self-development and application of principles covered. Written in partnership with the Institute of Internal Auditors with special attention to its revised standards and guidelines, The Internal Auditor at Work includes chapters on: The audit context The strategic dimension Quality and audit competence The audit process The audit proposition And more In a business environment currently undergoing major reevaluation, The Internal Auditor at Work provides an invaluable tool for internal auditing professionals and all others with an interest in adding value to their organizational processes.

Download or read book The Internal Auditing Handbook written by K. H. Spencer Pickett and published by John Wiley & Sons. This book was released on 2010-09-07 with total page 1091 pages. Available in PDF, EPUB and Kindle. Book excerpt: The first edition of The Internal Auditing Handbook received wide acclaim from readers and became established as one of the definitive publications on internal auditing. The second edition was released soon after to reflect the rapid progress of the internal audit profession. There have been a number of significant changes in the practice of internal auditing since publication of the second edition and this revised third edition reflects those changes. The third edition of The Internal Auditing Handbook retains all the detailed material that formed the basis of the second edition and has been updated to reflect the Institute of Internal Auditor’s (IIA) International Standards for the Professional Practice of Internal Auditing. Each chapter has a section on new developments to reflect changes that have occurred over the last few years. The key role of auditors in reviewing corporate governance and risk management is discussed in conjunction with the elevation of the status of the chief audit executive and heightened expectations from boards and audit committees. Another new feature is a series of multi-choice questions that have been developed and included at the end of each chapter. This edition of The Internal Auditing Handbook will prove to be an indispensable reference for both new and experienced auditors, as well as business managers, members of audit committees, control and compliance teams, and all those who may have an interest in promoting corporate governance.