Audit Exemption for Small and Medium Enterprises: Perceptions of Malaysian Auditors

Hasnah, Hasnah; Ishak, Ismail; Ganesan, Yuvaraj; Zulhalwati, Hamzah

doi:10.21315/aamj2016.21.2.7

Cited by 9 publications

(9 citation statements)

References 30 publications

(52 reference statements)

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“…Non-Big-4 firms attempt to cut audit costs. Local auditors compete for SMEs and non-listed enterprises with personal ties and fee discounts (Haron et al, 2016). Notes: Scale of response: 1 ¼ "strongly accept" to 5 ¼ "strongly reject" (The least, the higher acceptance).…”

Section: Findings and Discussionmentioning

confidence: 99%

Small firm auditing using the analytical procedures (APs) in a politically challenging context

Abu Alia,

Abdeljawad,

Rashid

et al. 2024

IMEFM

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Purpose This study aims to explore the use, effectiveness, motives and obstacles of analytical procedures (APs) used by auditors in Palestine, a context characterised by a pool of small and medium enterprises (SMEs), a limited skill set, poor quality of data, political uncertainty and a community-based business culture. Design/methodology/approach The study considers the audit market in Palestine using a sequential mixed-methods approach combining a questionnaire survey and a series of in-depth interviews. A total of 129 Big-4 and non-Big-4 auditors were surveyed. Findings The use of APs is driven by the auditor size (Big-4 vs non-Big-4) and the client size (large vs SMEs). Even though the use of APs has increased over the past decade, audit objectives, know-how, and personal, family and social connections among auditors and clients influence the quality of the audit process. Practical implications Small firms take advantage of the lack of audit governance in Palestine. Our findings suggest that the regulators should help bridge the knowledge-sharing programmes between the small and large audit firms to help improve audit quality. Originality/value Studies on audit quality, particularly using APs, in the context of politically unstable cases such as Palestine are limited. The study has implications for the use of APs in the case of SMEs to prepare for the technological revolution that will modernise audit procedures and quality soon.

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Section: Findings and Discussionmentioning

confidence: 99%

Small firm auditing using the analytical procedures (APs) in a politically challenging context

Abu Alia,

Abdeljawad,

Rashid

et al. 2024

IMEFM

View full text Add to dashboard Cite

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“…In circumstances, once the external and internal users of audited financial statements recognise their benefits and require the assurance that an audit brings, the demand for audits will prevail. The fundamental purpose of an audit is to inform shareholders regarding the management of the company (Haron et al, 2016). The stakeholders may request the company to provide audited financial statements if it is required (SSM, 2017).…”

Section: Related Stakeholder and Voluntary Auditmentioning

confidence: 99%

Factors Influencing Voluntary Audit among SME Companies in Malaysia

Suman¹,

Ismail²

2023

IJARAFMS

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Small and Medium Enterprise (SME) companies in Malaysia have been given an opportunity for not having their financial statements to be audited under audit exemption regulations. However, there are companies voluntarily demanding for financial audit. Thus, this study examined the factors influencing voluntary audit among SME companies in Malaysia. Three factors were chosen namely, firm size, related stakeholder, and internal control towards voluntary audit. Using a survey questionnaire as the research instrument on 122 of SMEs, the results show that there is a significant positive relationship of related stakeholders and internal control in influencing voluntary audit among SME companies in Malaysia. Firm size however shows an adverse result by the significant negative relationship towards voluntary audit. The findings also prove that all the three factors have significant influence on SMEs in demanding for voluntary audit with related stakeholder appears as the strongest predictors in this study. This study achieved all of the three objectives. It provides further understanding from the SMEs viewpoint and the agreeableness to demand for voluntary audit despite the exemption provided by the regulators. Furthermore, the study also provides significant implications to the practical view for SME companies and accounting firms, and to academic view as the study may contribute to the researchers and educators on the view of voluntary audit after the regulation has taken place.

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“…Pada Juli 2009, the International Accounting Standards Board (IASB) mempublikasikan the International Financial Reporting Standard (IFRS) untuk UKM. Standar ini dimaksudkan untuk diterapkan pada entitas tanpa akuntabilitas public (Haron et al, 2016). Standar akuntansi untuk UKM yang diterbitkan oleh IASB ini masih terlalu kompleks untuk diterapkan secara total di Indonesia sehingga Ikatan Akuntan Indonesia (IAI) mengadopsinya menjadi Standar Akuntansi Keuangan Entitas Tanpa Akuntabilitas Publik (SAK ETAP) yang disesuaikan dengan kondisi di Indonesia pada tahun 2011.…”

Section: Pendahuluanunclassified

“…Berkurangnya risiko informasi setelah laporan keuangan diaudit oleh auditor independen dapat meningkatkan kepercayaan bank ketika sebuah UKM akan mengajukan pendanaan usaha. Haron et al (2016) berpendapat bahwa audit akan mampu mengurangi risiko bagi para investor dan mampu memfasilitasi UKM untuk mendapatkan permodalan. Selanjutnya dia menjelaskan bahwa audit mampu mengurangi kemungkinan kesalahan yang disengaja yang mengarah pada kecurangan dalam pengelolaan keuangan perusahaan.…”

Section: Manfaat Auditunclassified

Peran Audit Ekternal Dalam Memajukan Usaha Kecil Dan Menengah Di Jawa Tengah: Sebuah Kajian Konseptual Di Jawa Tengah: Sebuah Kajian Konseptual

2022

SAAP

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Small and Medium Enterprises (SMEs) are the backbone of the economy in most countries around the world, including Indonesia. In Central Java, until the end of the fourth Quarter of 2016, there were 115,751 units of SMEs contributing for 791,767 jobs. Some of the weaknesses of SMEs compared to large and modern businesses is the limited financial condition and difficulties faced when it will apply for funding to the bank. It is because SMEs generally are unable to present the financial statements in accordance with the accounting standards as one of lending criteria from the bank. To overcome the problem, the financial statement of SMEs should be audited by the independent auditors. Therefore, the financial statement of SMEs will be more reliable so that the bank will approve SMEs credit application. In another word, the audit for SMEs can be said as one of the ways to overcome the weakness of SMEs so that SMEs will become more bankable.

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Audit Exemption for Small and Medium Enterprises: Perceptions of Malaysian Auditors

Abstract: The objective of the study is to examine audit firm size, the provision of non-audit services (NAS)

Cited by 9 publications

References 30 publications

Small firm auditing using the analytical procedures (APs) in a politically challenging context

Small firm auditing using the analytical procedures (APs) in a politically challenging context

Factors Influencing Voluntary Audit among SME Companies in Malaysia

Peran Audit Ekternal Dalam Memajukan Usaha Kecil Dan Menengah Di Jawa Tengah: Sebuah Kajian Konseptual Di Jawa Tengah: Sebuah Kajian Konseptual

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