Internal Audit Quality and Financial Reporting Quality: The Joint Importance of Independence and Competence
| Autor: | Susan Parker, Brian Daugherty, Lawrence J. Abbott, Gary F. Peters |
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| Rok vydání: | 2015 |
| Předmět: |
Finance
Economics and Econometrics 050208 finance Actuarial science business.industry education 05 social sciences Audit evidence Accounting Chief audit executive 050201 accounting Audit plan Auditor independence Quality audit Internal audit Joint audit 0502 economics and business Information technology audit business |
| Zdroj: | Journal of Accounting Research. 54:3-40 |
| ISSN: | 0021-8456 |
| DOI: | 10.1111/1475-679x.12099 |
| Popis: | In light of the growing importance of internal audit functions (IAF) and the limited archival evidence on internal audit quality, we examine an interactive model of IAF quality (comprised of competence and independence) to better understand the determinants of IAF effectiveness as a financial reporting monitor. Our tests support the hypothesis that the joint presence of competence and independence is a necessary antecedent to effective IAF financial reporting monitoring. In sum, our results show that, the answer to “what is the effect of internal audit competence (independence) on financial reporting quality?” is “it depends on the independence (competence) of the internal auditor.” Our study extends the understanding of IAF quality determinants in the realm of financial reporting as it relates to ongoing discussions by researchers, standard setters, regulators, and practitioners. |
| Databáze: | OpenAIRE |
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