The Current State and Future of the Audit Profession

Lombardi, Danielle R.; Bloch, Rebecca; Vasarhelyi, Miklos A.

doi:10.2308/ciia-50988

Cited by 18 publications

(14 citation statements)

References 10 publications

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“…Henry et al (2007) revealed that there are several weaknesses in the audit system, including the failure of the auditor to identify transactions of related parties that have special transactions. They also stated that notes on financial reports were intentionally misinterpreted or improper in order to influence financial policies issued by investors or report users (Kuhn and Siciliani 2013;Lombardi et al 2015;Roychowdhury et al 2019). Table 4 Ways of fraud on Government organizations.…”

Section: Concealment Techniques and Methodsmentioning

confidence: 99%

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Financial intelligence: Financial statement fraud in Indonesia

Ikbal¹,

Irwansyah²,

Paminto³

et al. 2020

JISIB

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Indonesia is currently in an honesty crisis, especially in financial governance, bothin government and private institutions. Our study uses the concept of financial intelligence toidentify and collect information related to financial affairs in an organization. We use theopinions of 76 auditors regarding various fraudulent attempts, both with fraudulent financialstatements and other corrupt practices in organizations in Indonesia. Our important finding isthat small companies are more likely to commit fraud due to weak supervisors than listed publiccompanies. This is also more likely than family-owned companies and government levelorganizations. It was indicated by some respondents that local government level organizationswith weak supervision are more likely to commit fraud than local governments with closesupervision from urban communities. The results of the non-parametric relationship analysisshow that although there is a possibility that the more experienced the auditor is, the more ablethey are to detect fraud and manipulation in the organization, the relationship is relativelyweak. Other findings also show that auditors who have a CFE certificate find it easier to findfraud in the company.

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Section: Concealment Techniques and Methodsmentioning

confidence: 99%

“…Fraud can occur in any sector, including the private sector, public services, and both national and international organizations (Lombardi et al 2015;Charlopova et al 2020). Indonesia has recorded massive cases of fraud since the government's efforts to eradicate corruption in the reform era (Lewis and Hendrawan 2019).…”

Section: Introductionmentioning

confidence: 99%

Financial intelligence: Financial statement fraud in Indonesia

Ikbal¹,

Irwansyah²,

Paminto³

et al. 2020

JISIB

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“…Although IT has significantly changed the audit environment over the last several years, few studies have examined and documented audit IT use longitudinally. This is somewhat surprising given the influence of IT on the manner in which audits are performed and the potential for significant improvements to audit quality, effectiveness, and efficiency (Bedard, Deis, Curtis, Jenkins 2008;Curtis et al 2009;Curtis and Payne 2014;Lombardi et al 2015;Westermann et al 2015). To provide important insights into the changes in IT over the last ten years, our descriptive study examines audit IT use and perceived importance in the current audit environment and compares our results to data collected in 2004 (see Janvrin et al 2008).…”

Section: Conclusion Implications and Future Researchmentioning

confidence: 99%

“…Lewis Ferguson, PCAOB board member, September 8, 2015 As business processes have become more complex and as extensive innovations in information technology (IT) 1 have fundamentally altered the way businesses operate, auditors are using IT to assist them with the audit process, including workpaper review and fraud brainstorming (Kotb and Roberts 2011;Rosli, Yeow, and Siew 2012;Dowling and Leech 2014;Tysiac 2015). 2 Due to these technological changes and increased emphasis on IT internal controls, conventional audit practices and techniques have become outdated, creating a need for IT-driven audit techniques that can potentially improve audit quality, efficiency, and effectiveness (Pathak and Lind 2010;Curtis and Payne 2014;Lombardi, Bloch, and Vasarhelyi 2015). While IT has evolved over the past decade, limited guidance is available to assist practitioners in determining how IT can be used in their audits and the importance of IT use to practitioners.…”

Section: Introductionmentioning

confidence: 99%

Information Technology in an Audit Context: Have the Big 4 Lost Their Advantage?

Lowe

Bierstaker

Janvrin

et al. 2017

Journal of Information Systems

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Audit firms use information technology (IT) to improve audit quality, effectiveness, and efficiency. While audit IT has evolved over the past decade, limited guidance is available to assist practitioners in determining how IT can be used. Our research objectives are fourfold. First, we examine to what extent auditors use and assess the perceived importance of IT in their audits. Second, we look at different-sized firms to determine whether IT adoption and implementation decisions differ by firm size. Third, we investigate changes in auditors' use and perceived importance of IT over the past decade. Fourth, we examine whether IT has impacted the communication modes used by auditors when reviewing workpapers and fraud brainstorming. Overall, Big 4 auditors were not significantly more likely to use IT than non-Big 4 auditors, suggesting that the dominance of the Big 4 firms' use of IT has lessened. In fact, there are a few applications where non-Big 4 auditors appear to have taken the lead. In addition, our findings indicate that auditors have increased the use of all the IT applications we examined ten years ago. However, we find evidence that auditors may prefer to use even more IT in their audits than they are currently using. Data Availability: Data used in this study are available for download, see Appendix B.

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“…Also, this sort of automation can save time used in repetitive tasks and allow auditors to work in riskier areas. This has been recently examined by Lombardi et al (2015): "automation will be used for more repetitive, transactional tasks, allowing auditors more time to apply their expert judgments to riskier, more pressing areas".…”

Section: Conclusion and Discussionmentioning

confidence: 99%

Triple entry ledgers with blockchain for auditing

Simoyama

Grigg²,

Bueno

et al. 2017

IJAUDIT

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Legislation generally requires public agencies to account for their activity to the public. Among the many duties imposed by legislatures around the world are requirements for transparency in procurement of services, budgeting and presentation of accounts. However, agencies in countries with high corruption problems have trouble complying with the legislation, especially in smaller agencies. Moreover, it is typically infeasible for national auditors to audit all the accounts rendered, and instead, they select a small sample for audit based on their level of risk. Another problem is that the presentation of accounts occurs once a year for all agencies, leading to a seasonal demand with significant lag time between auditing and accounting period. In this study, we present a non-technical framework based on the emerging technology of blockchain that could be a solution to all these concerns. We apply it within the context of Brazilian legislation and the Federal Court of Accounts of Brazil (TCU), although the proposal is applicable across a wide range of countries facing severe corruption.

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The Current State and Future of the Audit Profession

Cited by 18 publications

References 10 publications

Financial intelligence: Financial statement fraud in Indonesia

Financial intelligence: Financial statement fraud in Indonesia

Information Technology in an Audit Context: Have the Big 4 Lost Their Advantage?

Triple entry ledgers with blockchain for auditing

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