Is the External Audit Report Useful for Bankruptcy Prediction? Evidence Using Artificial Intelligence

Muñoz‐Izquierdo, Nora; Miñano, María del Mar Camacho; Vargas, María Jesús Segovia; Pascual‐Ezama, David

doi:10.3390/ijfs7020020

Cited by 23 publications

(10 citation statements)

References 98 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Financial statement fraud in Malaysia has always been the public's concern with regard to professional ethics. In the event of corporate collapse, one should not ignore the importance of audit quality (Muñoz-Izquierdo et al, 2019). In 1994, Bursa Malaysia deemed it necessary for public firms in Malaysia to establish audit committees to improve the monitoring system of financial reporting processes and corporate governance.…”

Section: Malaysian Code Of Corporate Governancementioning

confidence: 99%

Corporate governance performance and financial statement fraud: evidence from Malaysia

Nasir

Hashim

2020

JFC

View full text Add to dashboard Cite

Purpose This paper aims to review the performance of corporate governance practices in Malaysia from the beginning of the 21st century until recently. This paper also highlights the history of corporate governance practices in Malaysia and the country’s financial statement fraud situation. Design/Methodology/Approach Malaysia is a multi-ethnic society that requires managing corporations and firms collectively. Hence, corporate governance practices and good practices are compelled to fit society’s uniqueness. This paper used the survey findings generated from the Corporate Governance Watch Report (CG Watch Report) by the Credit Lyonnais Securities Asia and the Asian Corporate Governance Association from the year 2002 to the year 2018 and discussed the corporate governance performance related to financial statement fraud in Malaysia. The market ranking survey oversees five categories of corporate governance scores: rules and regulations, enforcement, political/regulatory environment, adoption of International Generally Accepted Accounting Principle and corporate governance culture Findings The findings reported that firms in Malaysia have benefited from good laws and regulations through corporate governance reforms. Practical Implications This study’s findings are relevant to regulators, board members, shareholders, potential investors, analysts and others to produce more informative timely comparisons. Future research should consider analysing and comparing the corporate governance performance in Malaysia with the corporate governance performance of other countries in Asia. Originality Value This study summarized the findings generated from a periodical CG Watch Report from the year 2003 to 2018. This study also underlined the actions of responsible agencies and regulatory bodies determined to have a decent corporate governance practice in Malaysia, especially in minimizing financial statement fraud occurrence in the country.

show abstract

Section: Malaysian Code Of Corporate Governancementioning

confidence: 99%

Corporate governance performance and financial statement fraud: evidence from Malaysia

Nasir

Hashim

2020

JFC

View full text Add to dashboard Cite

show abstract

“…Porter et al (2009) showed that 47% of non-professional investors in the UK and New Zealand rarely read audit reports in their entirety. Muñoz-Izquierdo et al (2019) reported that users of audit report do not need to read the complete audit report to predict chances of bankruptcy.…”

Section: The Value Of Audit Reports For Stakeholdersmentioning

confidence: 99%

Improving Audit Reports: A Consensus between Auditors and Users

Goicoechea

Gómez‐Bezares

Ugarte

2021

IJFS

View full text Add to dashboard Cite

Audit reports represent the only information stakeholders have about conducted audits and they are a key instrument used in economic and financial decisions. Improving audit reports should be a priority of regulators and auditors. The authors solicited perceptions from 212 experienced auditors and financial report users about the value of audit reports and ways to improve their format and content. An analysis of the responses suggests that adding information on audits (such as auditor’s responsibility about fraud) and on annual accounts and client’s information systems, without significant changes in the format, would improve the decision usefulness of audit reports. The growing sophistication of markets and reporting standards requires new information in audit reports, such as auditors’ conclusions about management’s estimates in annual accounts. The study is useful to regulators, auditors’ corporations, academics, and users and contributes to the current audit literature by providing evidence on consensus between auditors and users with regard to the format and content of audit reports.

show abstract

“…In the 2000s, the AI used by auditors expanded; this is due to the increase in the trust and auditors to use the technologies to accomplish work activities. The AI expands the scope of CPA firms' services (Manita et al, 2020) improves auditor decision making and judgment (Zhang, 2019), leverages auditors' ability to expect the clients' going concern (Muñoz-Izquierdo et al, 2019), and helps auditors to reach reliable and accurate opinion (Cičak & Vašiček, 2019;Goryachikh et al, 2019;Sun, 2019).…”

Section: Emerging Technologies In Auditing and Assurancementioning

confidence: 99%

Audit and tax in the context of emerging technologies: A retrospective analysis, current trends, and future opportunities

Atayah¹,

Alshater²

2021

IJDAR

View full text Add to dashboard Cite

This study aims to review the existing literature on audit and tax in the context of emerging technologies, besides providing future research agenda. A meta literature approach by combining bibliometric and content analysis was adopted to analyze 154 relevant English articles published in Scopus indexed journals, published over the last 35 years. Using RStudio, VOSviewer, and Microsoft Excel. Quantitative findings reveal that the USA is the top contributor and the most cited in the world. Brigham Young University, on the institutional level, is the most relevant affiliation. Concerning publication number, the Journal of Emerging Technologies in Accounting is the most relevant source. At the same time, the most cited source is the Decision Sciences journal. While the most prolific author is Miklos Vasarhelyi. Moreover, the emerging technologies, including big data, blockchain, and artificial intelligence, have significantly drawn accounting scholars interest from 2015 and thereafter. From the perspective of qualitative findings, the main focus shows that employing advanced technologies offers promising opportunities to mitigate the risk of tax evasion and enhance the auditors' efficiency. The content analysis reports two mainstreams tax and audit; each one is classified into three sub-streams, big data, artificial intelligence, and blockchain. This study contributes to present a clear and coherent understanding of the relevant exact literature and propose future research. However, the study review confines only on audit and tax fields, relying on the Scopus database.

show abstract

Is the External Audit Report Useful for Bankruptcy Prediction? Evidence Using Artificial Intelligence

Cited by 23 publications

References 98 publications

Corporate governance performance and financial statement fraud: evidence from Malaysia

Corporate governance performance and financial statement fraud: evidence from Malaysia

Improving Audit Reports: A Consensus between Auditors and Users

Audit and tax in the context of emerging technologies: A retrospective analysis, current trends, and future opportunities

Contact Info

Product

Resources

About