A Case-Study on State-Owned Firms Agency Costs: A Call for More Effective Governance and Board Independence

Francisco, Paulo

doi:10.1080/10999922.2022.2046969

Cited by 2 publications

(2 citation statements)

References 39 publications

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“…Enron, Worldcom) occurred due to misreported financial information (Sridharan et al , 2006), leading to increased scrutiny and regulatory reforms. Fraudulent financial reporting reveals deficiencies in auditing practices, giving rise to concerns alluding to the auditor’s behaviour and independence (Kalbers, 2009; Francisco, 2023). Consequently, audit quality has become a prominent topic in the management and accounting literature (DeFond and Zhang, 2014; Tepalagul and Lin, 2015; Salehi et al , 2020; Hoopes et al , 2018), in particular, studies that focus on what drives auditors to provide audit quality.…”

Section: Introductionmentioning

confidence: 99%

“…This research focuses on Portuguese auditors for valuable insights. Managers of Portuguese companies often display considerable reluctance in sharing comprehensive financial information about their firms (Francisco, 2023), making the work of auditors much harder and more stressful. The Portuguese culture, characterized by tolerance for missed deadlines and deficiencies in information management, particularly regarding financial statements (Jorge et al , 2012), provides an excellent context for studying the effects of soft skills on audit quality.…”

Section: Introductionmentioning

confidence: 99%

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The relationship between soft skills, stress and reduced audit quality practices

Samagaio,

Morais Francisco,

Felício

2024

RAF

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Purpose This study aims to identify the effect of soft skills as a driver of audit quality and their moderating role in the relationship between stress and the propensity for auditors to engage in reduced audit quality practices (RAQP). Design/methodology/approach This study uses a sample of 130 auditors, whose data were collected through an electronic questionnaire. The results were derived from the partial least squares-structural equation modelling method. Findings The findings show that the propensity to incur RAQP increases when auditors are under job stressors but decreases when individuals have resilience and time management skills. Moreover, the results suggest that the moderating effect of these two soft skills can effectively reduce the auditors’ propensity to engage in dysfunctional actions and judgments in auditing. Emotional intelligence and self-efficacy skills are shown not to affect RAQP. Originality/value This study adds to previous research on auditors’ drivers for supplying audit quality, by providing evidence of auditor characteristics as a critical input to audit quality. The results emphasize the importance of researchers including in models the moderating effect of soft skills on the relationship between audit quality and determinants associated with audit firms, clients or the regulatory framework.

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