The Auditor's Reporting Model: A Literature Overview and Research Synthesis

Church, Bryan K.; Davis, Shawn M.; McCracken, Susan

doi:10.2308/acch.2008.22.1.69

Cited by 187 publications

(152 citation statements)

References 62 publications

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“…The limited information available from third party sources for IPO companies (Aharony, Lin, and Loeb 1993;Friedlan 1994), however, makes it difficult to judge the appropriateness of reported accounting numbers (Fan 1997). When other outlets do not provide credible information, the audit report becomes particularly useful (Church et al 2008). Collectively, these results indicate that disclosure (particularly voluntary disclosure)…”

Section: Voluntary Disclosure In the Ipo Settingmentioning

confidence: 90%

Are Voluntary Internal Controls-Related Audit Report Disclosures Informative in IPOs?

Czerney

2015

SSRN Journal

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Initial public offering (IPO) companies are exempt from Section 404 of the SarbanesOxley Act of 2002, leaving investors to assess the quality of an IPO company's internal controls, which affect the quality of management-provided financial information, without an opinion on internal controls effectiveness from management or the external auditor. When not engaged to opine on the effectiveness of internal controls, auditing standards permit auditors to voluntarily state that their opinion does not extend to internal control effectiveness. Given auditors' limited ability to distinguish financial reporting quality in the unqualified audit report, the costly nature of audit report modifications, and auditors' litigation risk concerns, these voluntarily audit report iii ACKNOWLEDGEMENTS

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Section: Voluntary Disclosure In the Ipo Settingmentioning

confidence: 90%

Are Voluntary Internal Controls-Related Audit Report Disclosures Informative in IPOs?

Czerney

2015

SSRN Journal

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“…Auditing plays an important role in credit decision-making process by providing auditing reports on companies' financial statements. Nevertheless, the extent of financial information that users achieve from these reports is still under discussion (Church, Davis, and Mccracken, 2008;DeFond and Zhang, 2014).…”

Section: Introductionmentioning

confidence: 99%

KM Theory Applied in Accounting and Statistics Education: Case on the Cost of Debt

Han

Liu

2017

EURASIA J MATH SCI T

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This study examines the impact of audit opinions on the cost of debt based on accounting education and knowledge management theory. The empirical results of whole sample regression show that audit opinions are negatively correlated with the cost of debt and financial marketization weakens the effect of audit opinions on debt pricing. The subsample regression results of audit opinions indicate that financial marketization is negatively correlated with the cost of debt only in companies with modified audit opinions. This implies that audit opinions play a more important role in debt pricing compared to the financial marketization of companies' localities.

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“…In what ways, if any, could the standard auditor's report or other auditor reporting be improved to provide more relevant and useful information to investors and other users of financial statements? Academic research findings suggest that users might benefit from materiality disclosures, auditors' findings in relation to fraud or illegal acts, disclosure of the engagement partner's name in the auditor's report, and disclosure of the communications between the auditor and audit committee (Church et al 2008). On the other hand, due to the complexity involved with applying materiality in practice, the disclosure of materiality amounts or measures could be very difficult as a practical matter, and would probably be more confusing than informative.…”

Section: Responses To Specific Questions In the Releasementioning

confidence: 99%

“…Why or why not? These clarifications are appropriate, as research evidence tends to suggest that users of the financial statements are confused about the auditor's responsibilities and level of assurance provided by the auditor's report (Church et al 2008).…”

Section: What Are the Potential Benefits And Shortcomings Of Implemenmentioning

confidence: 99%

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Comments by the Auditing Standards Committee of the Auditing Section of the American Accounting Association on the PCAOB Rulemaking Docket Matter No. 34: PCAOB Release No. 2011-003, Concept Release on Possible Revisions to PCAOB Standards Related to Reports on Audited Financial Statements.

Brazel¹,

Caster²,

Davis³

et al. 2011

Current Issues in Auditing

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SUMMARY Recently, the Public Company Accounting Oversight Board (PCAOB or Board) issued a concept release to solicit public comment on the potential direction of a proposed standard-setting project on the content and form of reports on audited financial statements. The objective of the concept release was to discuss several alternatives for changing the auditor's reporting model that could increase its transparency and relevance to financial statement users, while not compromising audit quality. To that end, the alternatives included (1) a supplement to the auditor's report, in which the auditor would be required to provide additional information about the audit and the company's financial statements (an “Auditor's Discussion and Analysis”), (2) required and expanded use of emphasis paragraphs in the auditor's report, (3) auditor reporting on information outside the financial statements, and (4) clarification of certain language in the auditor's report. The PCAOB provided for a 102-day exposure period (from June 21 to September 30, 2011) for interested parties to examine and provide comments on the conceptual approaches to rulemaking that might complement the application of Section 105(c)(6). The Auditing Standards Committee of the Auditing Section of the American Accounting Association provided the comments in the letter below to the PCAOB on the PCAOB Release No. 2011-003, Concept Release on Possible Revisions to PCAOB Standards Related to Reports on Audited Financial Statements. Data Availability: Information about and access to the release is available at: http://pcaobus.org/Rules/Rulemaking/Docket034/Concept_Release.pdf

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The Auditor's Reporting Model: A Literature Overview and Research Synthesis

Cited by 187 publications

References 62 publications

Are Voluntary Internal Controls-Related Audit Report Disclosures Informative in IPOs?

Are Voluntary Internal Controls-Related Audit Report Disclosures Informative in IPOs?

KM Theory Applied in Accounting and Statistics Education: Case on the Cost of Debt

Comments by the Auditing Standards Committee of the Auditing Section of the American Accounting Association on the PCAOB Rulemaking Docket Matter No. 34: PCAOB Release No. 2011-003, Concept Release on Possible Revisions to PCAOB Standards Related to Reports on Audited Financial Statements.

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