This paper examines whether and how individual auditors are disciplined for audit errors. Taking advantage of the long history auditor identity data from China, we find that signing with client restatements likely to lose privilege reports public clients. However, can avoid this consequence by issuing a modified opinion warn potential misstatement. We show more be when their firms operate in le...

Previous research on spreadsheet risks has predominantly focussed on errors inadvertently introduced by spreadsheet writers i.e. it focussed on the “end-user aspects” of spreadsheet development. When analyzing a faulty spreadsheet, one might not be able to determine whether a particular error (fault) has been made by mistake or with fraudulent intentions. However, the fences protecting against ...

Auditors may encounter misstatements during the course of an audit, each of which requires a binary materiality assessment. We propose a fuzzy expert system approach that assesses materiality as a continuous characteristic by allowing a misstatement to possess a degree of materiality between 0 and 1. This potentially allows the auditor more flexibility and precision in materiality assessment, a...

Very many things in our business and auditing environment are changing at an increasing rate. One central theme in auditing is how information technology developments affect the nature of the audit process and the audit skills. Auditors have to ask how to operate in new environments. New information technology support systems for monitoring and controlling operations could be useful. Artificial...

We examine whether the provision of non-audit services by auditors is negatively correlated with firm value and the quality of earnings. Because of concerns regarding the effect of non-audit services on auditor independence, the Securities and Exchange Commission recently issued revised auditor independence rules requiring firms to disclose in their annual proxy statement the amount of fees pai...

This paper illustrates an automated system that replicates the investigative operation of human fraud auditors. Human fraud auditors often utilize fraud detection methods that exploit structure in database tables to uncover outliers that may be part of a fraud case. From the uncovered outliers, an auditor will build a case of fraud by searching data related to the outlier possibly across many d...

13 Available online xxxx 12 14 15 16 17 18 19 20 21 22 PR OO In the practice of auditing, for cost concerns, auditors verify only a sample of accounts to estimate the error of the total population of accounts. The most common statistical method to select an audit sample is by monetary unit sampling (MUS). However, common MUS estimation practice does not explicitly recognize the multiple distrib...

Promotion of cycling can improve the sustainability level of a city or an urban area. This study presents a methodology that audits the bikeability level of the urban road environment across three selected routes in the city of Volos, Greece. This methodology is a useful toolkit in order to evaluate and improve the bikeability level of the urban road environment and also evaluate existing bikew...

Auditors demand financial models be transparent yet no consensus exists on what that means precisely. Without a clear modeling transparency definition we cannot know when our models are ‘transparent’. The financial modeling community debates which methods are more or less transparent as though transparency is a quantifiable entity yet no measures exist. Without a transparency measure modelers c...