External Auditing

Purpose -The purpose of this paper is to examine the extent and nature of the corporate social reporting (CSR) practices of the 40 largest Thai companies over the years 1997, 1999 and 2001. Design/methodology/approach -The extent and nature of CSR in annual reports was measured according to the number of words disclosed and trends were analyzed over this five-year period. CSR disclosure was classified according to five key themes, the nature of the evidence, and the type of news disclosed. Findings -The research showed, in aggregate, a trend of increasing amounts of corporate social disclosure, although the five-year trends varied within different industries. CSR among Thai companies was found to be primarily focused on human resources, providing "declarative" good news disclosures. Legitimacy theory, political economy theory and economic conditions were used to present explanations for the trends. The study concluded that while no single perspective can explain the disclosure of CSR, the empirical findings demonstrate that the key areas of company social exposure are reflected by CSR. Originality/value -This paper makes an important contribution to the knowledge of CSR in Asia and demonstrates similar issues in CSR reporting to those found in other countries.

This empirical study extends the existing, yet limited, literature on the influence of ownership concentration and family control on auditor choice. Following prior studies, a firm is considered using a higher-quality audit when its external auditor is one of Big 4 audit firms. The sample consists of 787 firm-year observations of public firms listed on the Indonesia Stock Exchange (IDX) in the financial years 2005-2007. Empirical evidence obtained reveals that firms with larger ownership concentration are more likely to hire a Big 4 auditor. Hence, in such firms, high-quality audits are employed to mitigate agency issues. However, when the controlling shareholder is a family, the association between ownership concentration and demands for high-quality auditors turns negative, implying that family-controlled firms tend to sustain opaqueness gains by hiring lower-quality auditors.

In September 2011, the European Union Commissioner Michel Barnier explained that there are weaknesses in the way the audit sector works today and the crisis highlighted them . Such weaknesses were not detected for the fi rst time: a few years earlier the problems of the audit sector emerged when Enron collapsed and the chicanery of its auditor Arthur Andersen was revealed to the markets. Since then, auditors and audit fi rms, namely, the Big Four have been subject to the long standing debates not only in the academic world but also in a number of European laws and regulations. This article examines the role of auditors in the global fi nancial crisis of 2008 and whether they actually failed in their role.

Design/methodology/approach -The paper draws on a questionnaire survey sent to managers and external auditors were asked to provide their opinion about intellectual capital measurement and reporting for companies listed in the Egyptian Stock Exchange.

Independent external auditing has recently received a great deal of attention, not only in the United Stated and in Europe but also everywhere else in the world, including in emerging markets such as Turkey. Turkey, as a candidate for European Union (EU) membership, has launched a number of company law reforms in the field of external auditing. This article presents the audit market structure in Turkey alongside the development of the laws on auditing. As a main contribution, this article presents a critical comparative discussion of the recent external auditing reforms by way of examining the related provisions of the new Commercial Code and the Capital Markets Law. The article also submits some policy recommendations , in particular on the establishment of the public oversight body and auditor liability rules.

Öz İç kontrol sistemi, kurumların amaçları doğrultusunda belirledikleri hedeflere ulaşmalarına engel olabilecek riskleri en aza indirerek kurum yönetimlerine; mevzuata uygun etkili, ekonomik ve verimli bir şekilde faaliyet gösterildiği, varlık ve kaynakların etkin bir şekilde yönetildiği; zamanında ve güvenilir bilgi ve raporlar üretildiği gibi hususlarda yönetime makul güvence sağlayan, kurumun tüm çalışanları tarafından hayata geçirilen mali ve mali olmayan bütün yöntem ve süreçleri içeren bütüncül bir yönetim aracıdır. Etkin bir şekilde işleyen iç kontrol sistemi, önemli miktarda kamu kaynağı kullanarak pek çok farklı alanda yerel hizmet sunan belediyelerin, başarılı bir şekilde yönetilebilmeleri ve belirledikleri hedeflere ulaşabilmelerinde yönetimin en önemli yardımcısı olacaktır. Bu çalışmanın amacı; Türkiye'deki belediyelerin iç kontrol sistemlerinin, kamu iç kontrol standartlarına mevcut uyum durumlarının belirlenerek iç kontrol sistemlerinin eksik yönlerinin giderilmesi ve tüm belediyelerde etkin olarak faaliyet gösteren iç kontrol sistemlerinin kurulmasına katkı sağlamaktır. Çalışmada Türkiye'deki büyükşehir belediyelerinin kamu iç kontrol standartları uyum eylem planları analiz edilerek büyükşehir belediyelerinin iç kontrol sistemlerinin kamu iç kontrol standartlarına genel uyum durumu araştırılmıştır. Araştırmanın sonucunda, büyükşehir belediyelerinin iç kontrol sistemlerinin kamu iç kontrol standartlarına uyumlarının istenilen düzeyde olmadığı, özellikle de iç kontrol sisteminin temelini teşkil eden risk değerlendirme ve kontrol faaliyetleri unsurlarına uyum düzeylerinin oldukça düşük olduğu tespit edilmiştir.

This paper comprises a review of the literature on materiality in accounting. The paper starts by examining the context in which materiality is relevant, and the problems arising from applying the concept in practice. Definitions of materiality from legal, accounting and stock exchange sources are compared. The relevance of materiality to various accounting situations is discussed. Methods of calculating quantitative thresholds are described and illustrated. Prior research is reviewed, focussing on materiality thresholds, and on the materiality judgments of auditors, preparers and financial statement users. The paper concludes with some suggestions for future research and for policy makers concerning this best kept accounting secret.

Keywords: Materiality definitions, Materiality thresholds, Materiality rules of thumb, Materiality judgments

This paper investigates the agency costs of multinational companies (MNCs) in relation to agency theory, in the Malaysian business environment. Using the data of 235 MNCs, this study explores their demand for monitoring costs and these companies' preferences between the monitoring costs components. The result indicates that MNCs incur significantly higher monitoring costs compared to domestic companies. However, the relationship between these companies and their preference between the components of the monitoring mechanisms, that is between directorship and auditing as their monitoring mechanism, is not significant. When the auditing components are further investigated, it reveals that MNCs incur more external audit costs compared to internal audit costs.

The awareness of association between auditor switching and the audit opinion is essential when legislation regarding mandatory audit practice is being done. To test the significance of the association, we collect data on audit opinion reports of a random sample that comprises 800 industrial entities from Republic of Serbia. Using Fisher's Exact Test, we conclude that companies that have received unqualified opinion in one period, and subsequently changed their auditor firm, were significantly less likely to receive unqualified opinion in the following period, when compared to companies that have not changed auditor.

The business experienced to implement ERP systems for improving operations then internal and external auditors facing new challenges need to improve their understanding within ERP environment, within ISA 610 does the external auditors mostly rely on the internal auditors' work under ERP continuous auditing? The research depended on questionnaire designed from main questions related to evaluating risks and assessing controls for system's data processing main steps (Inputs, Processing and Outputs), which distributed on internal auditors working inside companies adopting continuous internal audit for ERP systems (13 Jordanian Companies). In addition, for more reliability the designed questionnaire distributed on internal auditors working inside companies using ERP systems, but do not adopting continuous internal audit (44 Jordanian Companies). The research revealed that external auditor relies on continuous internal auditor work using ISA 610, which may indicate the need to improve external auditors' abilities in understanding and auditing computerized systems in general, specially auditing ERP systems. The research recommended audit offices in Jordan to give more concern regarding auditor's training and developing skills related to modern electronic information systems and encouraging to have professional certifications related to information systems such as CISA

Kamu kurum ve kuruluşlarının, kamu kaynaklarını kullanırken, gerçekleştirmiş oldukları iş ve işlemlerinin sadece mevzuata uygunluk, doğruluk ve düzenlilik yönlerinden denetlenmesi günümüzde artık yeterli görülmemektedir. Aynı zamanda bu kaynakların verimli, etkili ve tutumlu bir şekilde hesap verme sorumluluğu kapsamında kullanılması, sadece girdilere değil, çıktı ve sonuçlara odaklanan bir denetimi gerekli kılmaktadır. Bu bağlamda gelişmiş ve gelişmekte olan ülkeler açısında kamu mali yönetimi reformları kapsamında performans denetimi gündeme gelmiştir. Ülkemizde de kamu mali yönetimi alanında yapılan reformlar sonucunda Sayıştay Başkanlığı dış denetim kapsamında kamu idarelerine yönelik performans denetimi yapma yetkisine sahip olmuştur.

Bu çalışmada; kamu mali yönetimi alanındaki değişim ve dönüşümlere kısaca değinilmiş ve performans denetimi incelenmiştir. Bu kapsamda Sayıştay’ın performans denetim yetkisi tarihsel süreç içinde ele alınmıştır. Ayrıca yapılan yasal düzenlemeler ve bu düzenlemelerde Sayıştay’ın performans denetimi yetkisinin gelişimi ele alınmıştır. Sayıştay’ın yapmış olduğu performans denetimi kapsamında verimlilik, etkililik ve tutumluluk (VET) denetimi yapamadığı sadece performans bilgisi denetimi yaptığı tartışılmıştır.

COVID-19’un yayılımını kontrol altına almak için alınan tedbirler çerçevesinde işletmelerin bazıları faaliyetlerini geçici olarak durdurmuş, faaliyet seviyelerini düşürmüş ve iş yapış modellerinde zorunlu bazı değişiklikler yaparak uzaktan çalışmak zorunda kalmışlardır. Ayrıca, COVID-19 salgını çalışan sağlığı, finansal işlemler, tedarik zinciri ve siber güvenlik gibi sosyal ve ekonomik açıdan çok sayıda alanı etkilemiştir. COVID-19’un işletmeler açısından geniş kapsamlı ekonomik sonuçları gözlemlenmiştir. COVID-19’un işletmeler için ekonomik sonuçlarının olması sebebiyle, işletmelerin ekonomik faaliyetleriyle ilgilenen muhasebe ve bağımsız denetim alanları da etkilenmiştir. COVID-19 nedeniyle ortaya çıkan belirsizlikler ve riskler neticesinde ekonomik etkiler de söz konusu olmuştur. Aynı zamanda, işletmelerin finansal raporlama yapısı, varlıkların ve borçların muhasebeleştirilmesi ile dönem sonu değerlendirme işlemleri etkilenmiştir. Bunun yanında, sokağa çıkma yasakları sebebiyle denetim ile ilgili kanıt elde edilmesinde yaşanan sorunlar ve işletmelerin karşılaştıkları belirsizlik ile riskler sebebiyle bağımsız denetim çalışması yürütülürken dikkate alınması gereken hususlar ortaya çıkmıştır. Bu çalışmada COVID-19’un işletmelerin finansal performansına etkisinin finansal raporlarda sunulması, iç denetim ile bağımsız denetim alanlarına olan etkisi incelenmiştir.

Transactional business records are subject to a wide array of regulatory and auditing requirements. The problem of converting task specific business policies to database level constraints is challenging due to the immense complexity of corporate workflows and record lifecycles. In this paper we present a modeling framework for identifying business processes and record lifecycles within relational database systems that supports the automatic generation, implementation and verification of low level data management constraints. Our modeling language allows users to identify states of business processes within a relational database system and subsequently to enforce a broad set of conditional business rules based on the particular path that a business process has taken in the model. Our approach is unique in that it offers a single unified layer for process modeling and implementing complex workflow based constraints, temporal access control constraints, and records retention restrictions. Furthermore we propose the notion of "business process integrity" as a layer above traditional database integrity constraints, which combines conditional access control and general purpose temporal integrity constraints, to assure external auditors that each business record in the database has followed a legal path to its current state.

"In the wake of the recent financial crisis, increasing the effectiveness of auditing has weighed heavily on the minds of those responsible for governance. When a business is profitable and paying healthy dividends to its stockholders, fraudulent activities and accounting irregularities can go unnoticed. However, when revenue and cash flow decline, internal costs and operations may be scrutinized more diligently, and discrepancies can emerge as a result.

Effective Auditing for Corporates provides you with proactive advice-to help you safeguard core value within a corporation and to ensure that auditing processes and key personnel meet the expectations of management, compliance, and stockholders alike.

Aimed primarily at auditors (both external and internal), risk managers, accountants, CFOs, and consultants, Effective Auditing for Corporates covers:

* Compliance and the corporate audit
* Fraud detection
* Risk-based auditing
* The development of Sarbanes-Oxley
* Cultural changes in external auditing
* Auditing management information systems"