02 Accounting Information Systems (including topics about technology in accounting and blockchain) (AIS)

Permanent URI for this collection

Browse

Recent Submissions

Now showing 1 - 3 of 3
  • Item
    The Implications of IT Environment on the Audit and Financial Reporting Quality
    ( 2022) Choudhary, Preeti ; Sigler, Jake ; Ramadas, Vik
    This study explores the impact IT complexity and IT control deficiencies have on the audit and financial reporting. We create and validate a new theory-based measure of IT financial reporting complexity at the client level. Next, we quantify the cost of IT complexity and IT control deficiencies on audit effort. We find that, on average, an increase of one (out of 18) on the client’s complexity score relates to an increase of 6% in IT audit hours. In comparison, the presence of an IT control deficiency relates to a 70% increase in IT audit hours. We further investigate and find that IT specialist experience partially mitigates the cost of IT complexity and IT control deficiencies, in particular, experienced IT managers and senior managers rather than experienced IT partners and directors. Finally, we find that experienced IT specialists are able to mitigate some but not all of the cost of IT complexity on financial reporting reliability. Overall, our results provide some of the first insight into complex IT environments’ costs over financial reporting and highlights the importance of staffing decisions at the manager level.
  • Item
    Metaphysics of Internal Controls
    ( 2022) Gal, Graham
    A quality internal control system has been seen as a remedy for various corporate governance issues. Two pieces of legislation, the Foreign Corrupt Practices Act (FCPA) and the Sarbanes-Oxley Act (SOX) deal with very different corporate governance issues, but each argue for a similar remedy. Both the FCPA and the SOX legislation argue that improved (or proper) internal controls are necessary to root out bribery of foreign officials, in the case of the FCPA, and (in the case of SOX) to support the accurate preparation of financial statements. An issue that has yet to be resolved is that the quality of internal control systems is subject to subjective assessments of the internal control deficiencies and their impact. This paper presents a mathematical model of internal controls based on Gӧdel number of axioms. This results in the representation of quality internal controls in terms of an integer. This approach also allows for inferences about financial statements and various auditing judgements.
  • Item
    Critical Realism: A vital philosophical consideration for research on emerging technologies in auditing
    ( 2022) Fotoh, Lazarus Elad ; Lorentzon, Johan
    The purpose of this study is to explore the potential of critical realism as an important philosophical consideration for research on emerging technologies in auditing. Particularly, this study explores the ontological tenets of critical realism with its epistemological and methodological implications and examines its potential for research on the impact of emerging technologies on auditing. This paper appears to be the first to implements critical realism in studying the impact of emerging technologies on auditing. Our narrow focus in this area mainly results from the trumpeted transformational role of these technologies on auditing and the proliferation of contemporary research in this area touting these technologies for their prospects in enhancing audit efficiency, effectiveness, and audit quality. We conclude that the stratified ontology of critical realism is useful both for research on emerging technologies in auditing, specifically in understanding complexities, and for enhancing professional scepticism. The contribution of this study is multifaceted. Firstly, there is a great potential for research to go beyond the empirical domain in order to get a deeper understanding of different research problems. With a focus on generative mechanisms, critical realism also enables researchers to look beyond their intradisciplinary areas. Secondly, the adoption of critical realism may enhance scepticism (necessary for audit quality) among practitioners as they may sceptically question the benefits of these technologies. The adoption of critical realism can result in new research questions and challenge prior research through the implementation of a plurality of research methods.