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Auditors' Assessment (auditor + assessment)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting100%

Selected Abstracts

Identification of Perceived Interviewee Behaviors that Influence Auditors' Assessment of Deception

INTERNATIONAL JOURNAL OF AUDITING, Issue 3 2008
Chih-Chen Lee
US and international policy setters recently called for auditors to be alert for anomalous interviewee behaviors that may indicate deception. In this call, they included verbal behaviors, such as implausibility and inconsistency, as suggested indicators. This study empirically identifies the perceived verbal and physical interviewee behaviors that influence auditors' deception detection judgments. Perceptions of informativeness and body movement were found to increase auditors' suspicion of interviewees. The literature provides support for using deception indicators relating to informativeness for deception detection. However, the literature suggests that more body movement is a false deception indicator; that deceivers typically manifest less body movement when lying. The study's results also suggest that entry-level accountants use anxiety-related behaviors for deception detection, whereas experienced auditors do not. The deception detection literature suggests that anxiety-related behaviors do not predict deception. [source]

The Effects of Fraud and Going-concern Risk on Auditors' Assessments of the Risk of Material Misstatement and Resulting Audit Procedures

INTERNATIONAL JOURNAL OF AUDITING, Issue 3 2007
Allen D. Blay
This study uses audit file data to analyze the association between the auditors' preliminary assessments of going-concern and fraud risk and the planning and performance of the financial statement audit. We analyze the association between the above risks and the auditor's assessment of the risk of material misstatement (RMM) within the revenue cycle, and examine whether going-concern and fraud risk assessments have an effect on the persuasiveness, timing and extent of audit evidence gathered. Our results indicate that both fraud risk and going-concern risk are significantly related to RMM. Our results also indicate that although the effect of fraud risk is fully mediated by the RMM, moderate going-concern risk remains significantly related to our proxies for the persuasiveness and timing of audit evidence, even after controlling for RMM. [source]

Misstatement Direction, Litigation Risk, and Planned Audit Investment

JOURNAL OF ACCOUNTING RESEARCH, Issue 3 2001
Orie Barron
This study reports the results of an experiment showing that auditor assessments of litigation risk and planned audit investments are higher when potential errors overstate financial performance than when those errors understate performance. This result is much stronger in the presence of high levels of litigation risk in the client's industry. These results suggest that in industries where litigation risk is high audited financial statements may contain more unintentional material understatement errors than overstatement errors. Thus, litigation risk,through its effect on auditors,may encourage financial statements that understate firm performance [source]

The Effects of Fraud and Going-concern Risk on Auditors' Assessments of the Risk of Material Misstatement and Resulting Audit Procedures

INTERNATIONAL JOURNAL OF AUDITING, Issue 3 2007
Allen D. Blay
This study uses audit file data to analyze the association between the auditors' preliminary assessments of going-concern and fraud risk and the planning and performance of the financial statement audit. We analyze the association between the above risks and the auditor's assessment of the risk of material misstatement (RMM) within the revenue cycle, and examine whether going-concern and fraud risk assessments have an effect on the persuasiveness, timing and extent of audit evidence gathered. Our results indicate that both fraud risk and going-concern risk are significantly related to RMM. Our results also indicate that although the effect of fraud risk is fully mediated by the RMM, moderate going-concern risk remains significantly related to our proxies for the persuasiveness and timing of audit evidence, even after controlling for RMM. [source]