The study aims to know the relationship between the professional skepticism of the auditor and the discovery of fraud and errors in the financial statements, as the auditor's practice of professional skepticism enhances his ability to issue a neutral technical opinion about the fairness of financial statements. The study also examined the relationship of professional skepticism with audit risks, especially the risks that management controls and is responsible for, which are control risks and inherent risks. The auditor should not be satisfied with less than convincing evidence. No matter how honest and fair the management and those responsible for institutional control are, this should not prevent the auditor from using professional skepticism. In order to enhance the auditor's confidence in the audit outcome and not to rush into his ruling on financial statements, international audit standards urged the need to exercise professional skepticism at all stages of auditing to provide quality in the audit process and give confidence to internal and external users of those statements. The study recommended through examining and evaluating 112 questionnaires distributed to auditing offices and companies to pay attention to the practice of professional skepticism, especially in the event that the management and those responsible for institutional control do not respond to the auditor's inquiries. Also; the study recommended that auditors should not come to final decisions until sufficient, appropriate and reliable evidence has been obtained; through which they can reach the conviction of issuing impartial technical opinion. Received: 11 December 2020 / Accepted: 2 February 2021 / Published: 5 March 2021
This study has aimed to demonstrate the relative importance of financial analysis using ratios for each of lenders and investors in Jordan when making decision.Also; this study, included the financial ratios that could be adopted by decision makers in the industry (area) of lending or investment. The study included two categories; first is the category of financial intermediaries; to express the category of investors in Amman stock exchange (ASE), while the second category included employees of credit departments -in Jordanian banks- for the category of lenders.The collection of study data was based on a review of the subject's scientific literature, previous studies and by preparing a questionnaire that was designed on the basis of the theoretical framework of the study and its hypotheses.The objectives of financial analysis are to judge the efficiency of management and to use the information available to make various administrative decisions. The study found that financial ratios are used by data users when making decisions related to investment and lending. The results of the study also revealed the interest of lenders in debt and liquidity ratios, while investors' attention is focused on profitability and market ratios.
The relationship between audit quality and earnings management has not been tested with consideration of key audit matters as a mediating variable. This study examined whether audit quality (AQ) decreases earnings management (EM) in shareholding corporations through improving key audit matters (KAMs) in Jordan’s emerging environment. A regression analysis was carried out on a sample that included financial reports and auditor reports of 105 industrial and service shareholdings companies listed on the Amman Stock Exchange (ASE) from 2017 to 2019. The study found a negative relationship between audit quality and earnings management. The results showed that audit quality increases key audit matters, which, in turn, decreases earnings management. Also, the study confirmed the mediating effect of KAMs between audit quality and earnings management. The study confirms the importance of key audit matters to provide more relevant and useful information for the users of financial reports and provides important indications to the regulatory authorities and standards bodies that key audit matters should be given more attention regarding the way that they are presented and disclosed.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.