SUMMARY: This study investigates the role of business risk perspectives in the audit of smaller and medium-sized entities (SMEs) by small and medium-sized audit practices (SMPs). The research is important, since we have little knowledge of how SMPs utilize business risk factors, and there is a current debate about the need for proportionally applying auditing standards, including standards on business risks, in the audit of SMEs. We conduct 38 interviews with Dutch and German auditors of both small and medium-sized audit practices to capture a variety of different audit environments. We develop a model that considers a continuum of audit approaches ranging from a substantive-based audit approach to a full-scope business risk audit, and observe a limited and heterogeneous application of business risk perspectives by SMP auditors. We find that client complexity, enforcement by audit supervisory authorities, relative emphasis on book-tax alignment in different countries, and investments in audit technology are important factors explaining the use of business risk perspectives. The findings imply a need to provide auditors with sufficient flexibility to proportionally adjust their audit approaches in the application of international audit standards under varying client and audit firm conditions.

This study examines what the impact is of frequently proposed information needs on reducing the audit expectations gap (AEG), including information about the audited company, information about the audit process and changes to the auditors' report. We base our findings on a survey of 302 participants from the Netherlands, consisting of 61 bankers, 118 preparers and 123 auditors. We consider the AEG in essence to be a classic agency problem. We find that stakeholders fall back in basic strategies to maximize their own value: bankers require additional information, management is reluctant to let the auditor provide sensitive information and auditors try to minimize their risks. Further, we observe that only information about the audit process with respect to continuity and the reporting of errors in the financial statements may reduce the bankers' AEG. Finally, we observe that format changes to the auditors' report do not reduce the bankers' AEG.

The sociocultural and socioeconomic situation of sanitation in Dar-es-Salaam (Dsm), Tanzania, was studied with explicit emphasis on pit-latrines. Without considering the sociocultural conditions, the so-called best solution might not be the right one. Therefore, in order to achieve the intended goal, a literature review, a questionnaire survey, and personal visits to the chosen study areas were done. In total, 207 household questionnaires were filled in 16 areas of the city. Interviewers did house-to-house visits and questionnaires were filled out on the spot. Results indicated that the city population is about 3.8 million at present, with over 80% of the dwellers using pit-latrines; some 3% use septic tanks with soakage pits, about 6% are connected to the sewerage system, and 1% have no excreta disposal facility. Difficulties faced include dismal budget allocations, fragmentation of sanitation activities among subsectors, lack of or poor sanitation record keeping, unsatisfactory machinery for septic tank and pit-latrine emptying, lack of a clear policy on pit-latrine handling and, in competition for resources, low priority is accorded to an excreta disposal system among the people. City residents will continue to use the pit-latrines for a long time to come. Reusing the fecal sludge is not known by most city dwellers and is influenced by sociocultural habits. To prevent groundwater pollution and to recover useful products in human excreta and urine, ecological sanitation toilets and anaerobic digesters offer a good option.

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