Output Indicators of Audit Quality: A Framework Based on Literature Review

Badlaoui, Amine El; Cherqaoui, Mariam; Taouab, Omar

doi:10.13189/ujaf.2021.090619

Cited by 8 publications

(4 citation statements)

References 37 publications

(52 reference statements)

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“…), the mixed results noted in developing countries raises the issue of the lack of relevance of the auditor opinion regarding the reliability of the accounts as expressed by its inability to induce a market reaction. This finding contrast with the fact that there is a broader consensus of research in developed countries attesting a positive relationship between modified audit reports and market reactions, thus suggesting a growing utility of the audit report for investors increasingly considered by researchers as an output indicator for the quality of audit reports (El Badlaoui et al, 2021).…”

Section: Discussioncontrasting

confidence: 61%

Market Reaction to Modified Audit Opinions: A Systematic Literature Review in Both Developed and Developing Countries

Amine El Badlaoui,

Mariam Cherqaoui,

Issam Er-Rami

2023

aamjaf

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The purpose of this paper is to review the empirical literature on value relevance of audit reports by providing current evidence on the market reaction to modified audit opinions (MAOs). This study is motivated by the argument that recent research has resolved the research designs problems raised by the pre-2010 studies that resulted in unmitigated and contradictory results. We adopt a systematic literature review based on the guidelines presented by Kitchenham et al. to review papers published between 2010 and 2020. The main findings of our review show sufficient evidence that MAOs are indeed useful to investors in making decisions in developed countries, which is evidenced by the fact that the MAOs have a negative effect on the share prices of companies. In contrast, evidence from studies conducted in developing countries shows null market reaction to MAOs, with the exception of the Chinese market, which shows a significant reaction. The methodological limitations and alternative causes behind the null market reaction to MAOs of studies conducted in developing countries are discussed in this paper.

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Section: Discussioncontrasting

confidence: 61%

Market Reaction to Modified Audit Opinions: A Systematic Literature Review in Both Developed and Developing Countries

Amine El Badlaoui,

Mariam Cherqaoui,

Issam Er-Rami

2023

aamjaf

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“…Si bien es cierto, el objetivo de los actores principales en el escenario de la industria financiera es mantener la estabilidad financiera del sector, esto se puede lograr si se pronostica de manera adecuada el deterioro del desempeño de las instituciones financieras. Es necesario recalcar que, la principal función de los auditores externos es garantizar la fiabilidad de los estados financieros presentados por una entidad (El Badlaoui et al, 2021) y comunicar las salvedades o calificaciones implican aquellas dificultades para obtener información o documentos, graves acontecimientos que puedan amenazar la supervivencia empresarial, lo cual degrada la calidad de la información de auditoria (Rodríguez López et al, 2014). En este sentido, la situación financiera de una empresa juega un papel importante en la conducción de los negocios, lo que puede afectar sus operaciones a corto y largo plazo (Mavlutova et al, 2021).…”

Section: Determinación De Las Variables Que Influyen En Los Resultado...unclassified

Impacto de la Auditoría Externa en las Instituciones Financieras

Malatay-Monar,

Flores-Brito

2023

593DPCEIT

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La incertidumbre latente a sufrir riesgos y resultados perjudiciales en las operaciones que realizan las instituciones financieras constata el impedimento de cumplir los objetivos propuestos, es por ello que, nace la necesidad de incorporar auditorías externas en las cuales se puedan conocer y aplicar diferentes criterios de personas independientes a la empresa. Por tal razón, las auditorías externas han alcanzado un mayor nivel de importancia en los últimos años de pandemia, donde los líderes de las instituciones financieras buscan identificar los puntos críticos de la empresa y los riesgos emergentes a los que se exponen, para establecer un control adecuado en tiempo real. En este contexto, la investigación tuvo como objetivo evaluar el impacto que tienen las auditorías externas en la disminución de resultados negativos contables-financieros. Tomando como caso de estudio las instituciones financieras de la ciudad de San José de Chimbo, cantón chimbo, provincia de Bolívar, Ecuador. En cuanto al ámbito metodológico se empleó una investigación no experimental, con un enfoque mixto, mediante los métodos descriptivo y correlacional, que permitieron abordar la realidad del objeto de estudio, a través de las técnicas e instrumentos de investigación. Los resultados se centraron en fundamentar normativamente, medir el impacto y determinar las variables que influyen en los resultados negativos contable-financiero dentro de las instituciones financieras para minimizarlos, de este modo proporcionar una respuesta coherente a la pregunta investigativa. En conclusión, la auditoría externa es una herramienta que impacta positivamente a las instituciones financieras puesto que busca predecir el fallo financiero.

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“…The most important output element affecting audit quality is the audit report according to academic researchers (Knechel et al, 2013, Al-Qatamin & Salleh, 2020, El-Badlaoui et al, 2021. Even if it is not a standardized document as is the case with reports to public authorities, almost all audit reports contain some defining elements: the identification, evaluation and management of risks, ways to continue the organization's activity in good conditions, strategic financial and accounting aspects, policies of production or promotion, proposals for improvements of internal operational processes, etc.…”

Section: Literature Reviewmentioning

confidence: 99%

Determinants of Audit Quality and Connections with Economic Development and Education

Păcuraru-Ionescu,

Cîmpan,

Borlea

2023

Proceedings of the International Conference on Business Excellence

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The audit has been mentioned in documents since antiquity, even if the term is not the same, and its connotations have undergone major changes. There are many topics in the economic literature connected with the audit, but one of the most important and debated by specialists is the quality of the audit. And this was viewed over time in continuous evolution. A multitude of possible determinants have been stated theoretically and investigated empirically. Our study mentions several such factors, the ones that were the most stable over time, remaining continuously in the attention of researchers. Since they are very numerous, I have cataloged them by belonging to one of the elements that revolve around the audit: the inputs to the audit mechanism, the processes, outputs and results from the audit mechanism, the market context, premature approvals or methods and practices to reduce voluntary quality. I did not select the determinants randomly, but in such a way that some macroeconomic factors of the quality of the audit can be deduced from them. We thus identified that, at least theoretically, audit quality can be associated with economic development, general education, and financial education. To research these associations, we resorted to international data, performing both univariate and bivariate descriptive analysis based on maps, as well as a multivariate analysis based on hierarchical clustering. Due to the different typology of the available variables, we performed standardization to bring them all to the same statistical distribution, with possible values between 0 and 100. Hierarchical clustering uses Ward linkage for the grouping of units and the Euclidean distance between them. The groupings show a certain hierarchy between the groups in relation to the observed variables, but this is not perfect, as there are also atypical behaviors. We managed to identify some common behavioral patterns of the world’s countries, which we analyzed both economically and geographically.

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Output Indicators of Audit Quality: A Framework Based on Literature Review

Cited by 8 publications

References 37 publications

Market Reaction to Modified Audit Opinions: A Systematic Literature Review in Both Developed and Developing Countries

Market Reaction to Modified Audit Opinions: A Systematic Literature Review in Both Developed and Developing Countries

Impacto de la Auditoría Externa en las Instituciones Financieras

Determinants of Audit Quality and Connections with Economic Development and Education

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