The Effect of Frequency and Automation of Internal Control Testing on External Auditor Reliance on the Internal Audit Function

Farkas, Maia; Hirsch, Rina M.

doi:10.2308/isys-51266

Cited by 18 publications

(10 citation statements)

References 19 publications

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“…The next IAQ indicators might be considered when influenced by IA (Roussy & Perron, 2018): (i) shareholders' judgment and decisions (Holt & Dezoort, 2009); (ii) earnings management level (Abbott et al, 2016;Gras-Gil et al, 2012;Prawitt et al, 2009;Sierra Garcia et al, 2012); (iii) risk of fraud and the probability of its avoidance, detection and dissemination by IA (Asare et al, 2008;Coram et al, 2008;Ege, 2015); and (iv) deficiencies in internal controls (Mazza & Azzali, 2015;Farkas & Hirsch, 2016).…”

Section: Internal Audit Quality (Iaq)mentioning

confidence: 99%

A research profile on internal audit quality

Bissol

Oliveira

2022

Contextus

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Gaps in internal audit function (IAF), such as internal audit quality (IAQ), began to be pointed out by studies carried out after Sarbanes-Oxley (SOX) Act publication. As a subject still under development in the literature, this article seeks to delineate a research profile for the IAQ in the period from 1999 to 2021. To this end, a bibliometric profile on the subject was conducted, resulting in the identification of how the research area has progressed over the last 22 years, encompassing research clusters, main fields of study and citations networks. As a result, two maps were created: one based on text data and one based on bibliographic data.

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Section: Internal Audit Quality (Iaq)mentioning

confidence: 99%

A research profile on internal audit quality

Bissol

Oliveira

2022

Contextus

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“…According to paragraph 25 of ISA 330 Posits that based on the audit processes performed and the audit evidence gathered, the professional auditor should evaluate prior to the audit conclusion, whether the assessment of the risks of material misstatement or fraud at the verification level remain valid or appropriate. As envisaged, COVID-19 pandemic in many instances will necessitate auditors to consider if the design and application of the obtained responses to the identified risks is still relevant or there is need that they be revised (Erwin, Abubakar & Muda, 2018;Farkas & Hirsch, 2016;Malaescu & Sutton, 2015).…”

Section: Risk Communicationmentioning

confidence: 99%

Risk Assessment and Auditors’ Responsibilities: An Assessment of COVID-19 Era

Alao¹,

Timilehin²

2021

theijbm

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Risk Assessment and Auditors' Responsibilities: AnAssessment of COVID-19 Era IntroductionThe global outbreak of COVID-19 and the scourge it brought have caused significant economic challenges with a devastating impact on world economies. The unprecedented impacts of the pandemic have disrupted professional services globally with accounting and auditing professional being no exceptional. Beside, all industries particularly, airline, retail, hospitality, oil and gas, education sector and many other service related industries have been adversely impacted, generated exceptional shocks in capital markets. These conditions have created many uncertainties for auditors and many public and private companies . The impact of the scourge provides a reminder for auditors risk reassessments as a fallout of pandemic to the responsibilities to identify, assess and respond to potential risks of clients' material misstatements. Apparently, the COVID-19 and its attendant effects have brought new realities that new risks may be identified likened with prior audits (El-Mousawi & Kanso, 2020). Many auditors' clients are facing exceptional uncertainties and these companies will now grapple with the realities that things have changed and understanding what getting back to prior conditions will look like different geographies and for diverse industries (Eriadi & Abdullah, 2018). Private corporations and public ones are now forced to provide as much information as it practicable to investors and others regarding the present financial statements. An assessment of COVID-19 effect will now necessitate identifying and carry out risk assessment and auditors responsibilities. This may obviously create multifaceted and challenging for auditors due to new risks will emerge as response to COVID-19 pandemic effects (Accountancy Europe, 2020).Many companies may need to consider new or different risks associated to the impact of COVID-19, For instance cases relating to: liquidity challenges, problem of access to capital, debt covenant compliance issues, ability to continue as a going concern, insider dealings and falsifications of previous estimations, cybersecurity, including data security in a computer-generated environment, possible changes in internal control dynamics over financial statement reporting, assets and goodwill impairments possibilities, realistic fair value estimations and assets valuations, third-party and vendor concerns and importantly, meeting industry specific regulatory requirements and economic considerations of associated risks as a result global lockdown and business disruptions (Owolabi & Folarin, 2020). Unfortunately, auditors are likely to encounter some constraints in an expected comprehensive risk assessment in completing the audit exercise and concerns in obtaining adequate information and evaluating sufficiently and appropriateness of audit evidence. Effectiveness of risk assessment, auditors' responsibilities and audit approach greatly depend on high display of professional competence and

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“…Selanjutnya, auditor internal membuat rekomendasi untuk komite audit tentang peningkatan pengendalian internal. Dzomira (2020) dan Farkas & Hirsch (2016) menunjukkan bahwa praktik yang dilakukan dalam rapat komite audit bertujuan membuat ang gota merasa nyaman, seperti keakuratan laporan keuangan dan hasil kualitas pekerjaan oleh auditor internal dan eksternal. Hal ini mengindikasikan arti "kenyamanan" sebagai aspek mental dari pekerjaan yang dilakukan oleh anggota komite audit (Jiang et al, 2018).…”

Section: Tabel 1 Tinjauan Efektivitas Iafunclassified

“…Lebih khusus lagi, pekerjaan IAF mampu memperlihatkan sejauh mana manajer puncak mampu bekerja secara kompeten dalam menangani risiko dan kontrol internal. Hal ini dikarenakan bahwa fungsi IAF memainkan peran sentral dalam pengembangan hubungan akuntabilitas antara manajemen perusahaan dan komite audit, yang mengacu pada masalah pokok yaitu agen dengan manajemen (Farkas & Hirsch, 2016). Hal yang lain juga dijelaskan dalam pernyataan Abidin (2017) bahwa faktor eksternal juga mampu meningkatkan kenyamanan komite audit secara keseluruhan dengan meningkatkan kolaborasi antara audit internal dan eksternal (audit joint approach).…”

Section: Memperkuatunclassified

Internal Audit Function Sebagai Penyedia “Kenyamanan” Komite Audit

Setyawati

Bernawati

2020

jamal

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Internal Audit Function sebagai Penyedia "Kenyamanan" Komite Audit. Penelitian ini menjelaskan makna "kenyamanan" dalam perspektif internal audit function (IAF) dengan komite audit. Metode yang digunakan adalah studi literatur pada sejumlah jurnal bereputasi. Penelitian ini menemukan bahwa keefektifan IAF memberikan jaminan peningkatan pengendalian internal serta peningkatan kenyamanan yang signifikan untuk komite audit. Pengetahuan unik, pertemuan interpersonal rutin, dan kolaborasi korporatif antara auditor internal dan auditor eksternal juga mampu meningkatkan kenyamanan komite audit. Beberapa manfaat lainnya juga dihasilkan dari kerja sama IAF dengan komite audit untuk menambah kenyamanan. Abstrack: Internal Audit Function as a "Convenience" Provider for Audit Committee. This study explained the meaning of "comfort" in the perspective of the internal audit function (IAF) with the audit committee.The method used was a literature study in a number of reputable journals. This study found that the effectiveness of the IAF provides a guarantee of increased internal control as well as a significant increase in comfort for the audit committee. Unique knowledge, regular interpersonal meetings, and corporate collaboration between internal and external auditors were also able to increase the comfort of the audit committee. Several other benefits also resulted in added convenience.

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The Effect of Frequency and Automation of Internal Control Testing on External Auditor Reliance on the Internal Audit Function

Cited by 18 publications

References 19 publications

A research profile on internal audit quality

A research profile on internal audit quality

Risk Assessment and Auditors’ Responsibilities: An Assessment of COVID-19 Era

Internal Audit Function Sebagai Penyedia “Kenyamanan” Komite Audit

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