Download or read book The Effect of Inherent Risk and Control Design Strength on External Auditors Decisions to Rely on Internal Audit Functions written by Mario J. Maletta and published by . This book was released on 1989 with total page 380 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Effect of Inherent Risk and Control Design Strength on External Auditors Decisions to Rely in Internal Audit Functions written by Mario J. Maletta and published by . This book was released on 1989 with total page 190 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Effect of Inherent Risk Knowledge Spillover and Litigation Risk on External Auditors Reliance on Client s Internal Audit Functions written by Meshari Al-Harshani and published by . This book was released on 2003 with total page 164 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Dissertation Abstracts International written by and published by . This book was released on 1989 with total page 552 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 The Role of Task Subjectivity and Risk of Material Misstatement on Auditors Configural Processing in Internal Audit Reliance Judgments written by Sudip Bhattacharjee and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a field-based questionnaire administered to practicing auditors, we examine how auditors simultaneously combine the key planning variables, client-level misstatement risk (comprised of inherent risk and control risk) with account-level subjectivity, when utilizing internal audit as a cost management tool. We contend that auditor use of internal audit will reflect a balance between the potential for efficiency gains and the implications regarding audit effectiveness. Prior internal audit research has primarily focused on lower and higher risk conditions with relatively few studies examining the implications of moderate risk scenarios on internal audit use. Data on actual audits from an instrument administered to external auditors reveal significant differences in reliance decisions across lower, moderate, and higher misstatement risk levels. Our results reveal that increases in account-level subjectivity have no effect on auditors' internal audit reliance judgments when risk of material misstatement is at lower levels. However, auditors increase their internal audit reliance when account-level subjectivity increases across moderate misstatement risk. Finally, our results suggest that auditors decrease their internal audit reliance when account subjectivity increases across higher misstatement risk. By examining these risk variables in combination, we provide insight into the complexities associated with external auditors' internal audit usage decisions in the post-SOX era. This research should be of interest to practitioners given PCAOB's limited guidance on how multiple risk factors should be combined when utilizing internal audit.
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 Accounting Control Evaluation and Auditor Judgement written by Theodore J. Mock and published by Routledge. This book was released on 2013-10-11 with total page 291 pages. Available in PDF, EPUB and Kindle. Book excerpt: This anthology presents the results of a comprehensive empirical study of internal control evaluation and auditor judgment initiated by Peat, Marwick, Mitchell & Co. in 1977 and originally published as an American Institute of CPAs research monograph in 1981, which was awarded the American Accounting Association Wildman Award in 1982. This book contains an updated review of the professional literature related to internal control, multivariate analyses of the original statistics and analyses of the decision criteria used by the auditors.
Download or read book Intelligent Internal Control and Risk Management written by Matthew Leitch and published by CRC Press. This book was released on 2016-05-23 with total page 259 pages. Available in PDF, EPUB and Kindle. Book excerpt: Many people in organizations resent internal control and risk management; these two processes representing unwelcome tasks to be completed for the benefit of auditors and regulators. Over the last few years this perception has been heightened by the disastrous implementation of section 404 of the Sarbanes-Oxley Act of 2002, which is generally regarded as having been too expensive for the benefits it has brought. This important book offers a way of improving this prevailing perception and increasing the value of control and risk management by bringing creativity and design skills to the fore. The value of risk and control activities is often limited by the value of the control ideas available and so Matthew Leitch provides an arsenal of 60 high performance control mechanisms. These include several alternative ways to design controls and control systems, as well as providing controls for monitoring and audit, controls for accelerated learning, and techniques for finding and recovering cash. This design material is combined with insights into the psychology of risk control, strategies for encouraging helpful behaviour and enabling change, and a surprisingly simple integration of internal control with risk management. The book is realistic, practical, original, and easier reading than most in the field. The material is not specific to any one country and has international appeal for internal auditors and all those concerned with risk management, corporate governance and security.
Download or read book Government Auditing Standards 2018 Revision written by United States Government Accountability Office and published by Lulu.com. This book was released on 2019-03-24 with total page 234 pages. Available in PDF, EPUB and Kindle. Book excerpt: Audits provide essential accountability and transparency over government programs. Given the current challenges facing governments and their programs, the oversight provided through auditing is more critical than ever. Government auditing provides the objective analysis and information needed to make the decisions necessary to help create a better future. The professional standards presented in this 2018 revision of Government Auditing Standards (known as the Yellow Book) provide a framework for performing high-quality audit work with competence, integrity, objectivity, and independence to provide accountability and to help improve government operations and services. These standards, commonly referred to as generally accepted government auditing standards (GAGAS), provide the foundation for government auditors to lead by example in the areas of independence, transparency, accountability, and quality through the audit process. This revision contains major changes from, and supersedes, the 2011 revision.
Download or read book When the World Isn t Always Flat written by Martin Weisner and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study addresses recent calls for research on the conditions influencing auditor decisions related to PCAOB-encouraged reliance on third-party experts. To this end, the present study explores the effect of psychological distance on external auditors' reliance when induced through physical distance in a telework relationship between an auditee and a specialist. The reliance decision focuses on the auditee's contracting with a computer audit specialist who works remotely through a telework arrangement. The psychological distance associated with this telework arrangement is examined both in the context of variance in the physical distance of the computer audit specialist and the interactive effect of a contextual factor - the historical experience with an auditee's internal audit function. A 2x2 experiment with a total of 121 experienced Big 4 auditors is conducted in which psychological distance (physically proximate or remote specialist) and historical experience with an auditee's internal audit function (presence or absence of a prior year material weakness in internal controls) are manipulated. Consistent with predictions based on construal level theory, we find that psychological distance affects auditors' reliance judgment such that increased distance leads to lower reliance. Furthermore, the historical experience with the auditee's internal audit function creates a halo effect which moderates the effect of psychological distance such that the differential effect of a present vs. absent prior year material weakness on auditors' confidence and associated willingness to reduce budgeted audit hours is larger for a psychologically distant specialist. The results of this study suggest that an auditee's choice of a more proximate specialist may garner greater reliance by the external auditor, particularly when there is a material weakness in the prior year audit that the specialist is intended to help ameliorate.
Download or read book An Understanding of the Differences Between Internal and External Auditors in Obtaining and Assessing Information about Internal Control Weaknesses written by Ian Burt and published by . This book was released on 2014 with total page 133 pages. Available in PDF, EPUB and Kindle. Book excerpt: A critical role of the internal auditor is to design and monitor their organization's system of internal controls (COSO, 2004). In addition, they may be expected to objectively assess the quality of internal controls as professional auditors (Gray, 2004). External auditors have expressed concern that an internal auditor's strong identity with their organization will bias any internal control assessments he or she makes of that organization (Schneider, 1984). Even so, accounting regulators believe internal auditors' internal control assessments can be objective, and also maintain that having external auditors rely on these assessments should help to lower audit fees without jeopardizing audit quality (AICPA, 1990 - AS 5). Through two separate experiments, relying on social identity theory, social norms and the organizational silence literature in psychology, I examine whether the “employee” identity the internal auditor assumes as a member of the organization encourages other employees to share more information about internal control weaknesses with the internal auditor than the external auditor. In addition, I explore conditions under which the external auditor may be willing to rely on the internal auditor's internal control assessment even if the internal auditor's organizational identity is strong. Overall, this research will help external auditors, managers and regulators understand conditions under which the internal auditor can maintain their objectivity when performing an internal control assessment. Specifically, this research examines the potential importance of cueing internal auditors through the use of a strong code of ethics, such as the code of ethics enacted by the Institute of Internal Auditors, to the maintenance of the objectivity of all internal auditors. If the internal audit work is objective enough to be relied upon by the external auditor, the client can benefit from an audit of high quality while at the same time potentially lowering overall audit fees.
Download or read book Modeling External Auditors Evaluations of Audit Risk and the Effect of the Task Environment on Consensus written by Frank Alan Orth Buckless and published by . This book was released on 1989 with total page 554 pages. Available in PDF, EPUB and Kindle. Book excerpt:
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 American Doctoral Dissertations written by and published by . This book was released on 1988 with total page 728 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Impact of Inherent Risk Control Risk Analytical Review Results and Experience on Auditors Planning Decisions for the Revenue Cycle written by Gary Stewart Monroe and published by . This book was released on 1992 with total page 31 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Impact of Inherent Risk Control Risk and Analytical Review Results on Auditors Planning Decisions for the Revenue Cycle written by Gary Stewart Monroe and published by . This book was released on 1995 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt:
