Audit Quality
2 articles filed under this keyword.
Determinants of Reducing the Expectation Gap and Its Impact on Audit Quality
Yadgar Abbas Homer, Ayad Shaker Sultan
The expectation gap between auditors’ performance and the demands or expectations of financial statement users is a persistent and widespread issue in the external auditing profession, both globally and locally. This gap has been extensively studied, evaluated, and analyzed by various committees, organizations, and researchers worldwide. It challenges the credibility of the auditing profession and can sometimes lead to conflicts. The Kurdistan Region is not immune to this issue, with frequent disputes arising between auditors and beneficiaries, particularly tax authority. This research aims to analyze and evaluate the expectation gap between auditors’ performance and the desires of financial statement users. It seeks to propose solutions to bridge this gap, thereby enhancing the quality of the auditing profession and ensuring the provision of highly credible financial statements in the Kurdistan Region. The study concludes that several factors contribute to narrowing this expectation gap. These include auditors’ adherence to auditing standards, their responsibility for detecting errors and fraud, and the awareness level of financial statement users regarding auditors’ roles and objectives. Improving these aspects can significantly enhance the quality of auditing. The research also emphasizes the need for auditors to improve their professional performance to meet users’ expectations and the importance of implementing both local and international auditing standards. To bridge the expectation gap between auditors’ performance and the desires of financial statement users, it can be recommended that enhanced Communication Improve communication between auditors and financial statement users to clarify the scope and limitations of the audit process.
Volume 12 · Issue 1 · February 2025The Effect of Management Preferences on Audit Quality Empirical Study on a Sample of Audit Firms in The Iraqi Environment
Nawzad Khudhur Saeed, Mohammed Huweish Allawi Al-Shujairi, Vian Sulaiman Hama Saeed
The current study aims to measure and analyze the nature of the management preferences of audit offices and companies to identify the selection and comparison between different audit offices and firms are made. Besides, it evaluates and analyzes the audit quality offices and companies in the Iraqi context and tests the relationship between the administrative preferences of companies listed on the Iraq Stock Exchange (ISX Henseforth) and the audit quality for audit offices and companies. For achieving the objectives of the study, a main hypothesis directly was adopted to test the relationship between the variables of the study within the framework of the practical side of the study. For this purpose, an applied approach based on evaluation and quantitative mathematical analysis was adopted. Moreover, the annual financial statements of the companies listed on the ISX and the official bulletins of the market were considered as the source of data taking period (2017-2021). The sample of study was mainly represented in a sample of Iraqi audit offices and companies, which amounted to (26) selected audit offices and companies. The sample was selected in the light of identifying and selecting a deliberate sample of the companies subject to audit and listed on the ISX, which amounted to (22) joint stock companies, where the data of those companies was adopted in evaluating the study variables related to the audit offices and companies of the study sample. Based on the collected data and information, a few conclusions are drawn from the results of this study, the most prominent of them was the existence of a relationship and fundamental impact of management preferences on audit quality. The results also showed that the majority of the companies in the study sample preferred to choose the five large audit firms and firms, where the general average percentage of management preferences for the five large audit firms and firms was (68%). This result is much more than the average percentage of their preferences for medium and small audit firms (40%). Among the provided recommendation was the need for the audited companies to realize the importance of choosing an audit company that provides a high-quality service, as this choice is of particular importance to investors, which is align with the market value of the company, by rationalizing the process of making investment decisions, and improving the efficiency of investment in it.