The purpose of this study is to discuss the current state and future of auditing. Expert consensus is used as a basis to examine the current state of auditing and generate modifications both needed and likely to occur in the audit profession. This study contributes to the literature by using the Delphi method to develop predictions as to the direction of the audit industry and discuss the implications associated with these predictions. If auditors can better understand where the profession stands and where it is headed, then they can better prepare for the future. Some predictions emerging from this study relative to future audit practices include increasing automation of audit procedures, more predictive financial statements, continuous auditing of financial statements and transactions, and an increasingly global perspective regarding audit activities.
SUMMARY Audited financial statements are intended to be timely and useful in decision making. To remain a valuable and relevant service, auditing must find a way to evolve. This paper summarizes a recent study (“The Future of Audit,” Lombardi, Bloch, and Vasarhelyi [2014]), which conducts an interactive forecasting method to gain expert consensus on the current state of the auditing profession and on how the profession will evolve over the next decade. Expert consensus emerging from the study includes increasing automation of audit procedures, more predictive financial statements, continuous auditing, and maintaining a global outlook on audit transactions. Data Availability: Please contact the corresponding author for data.
SYNOPSIS A board interlock occurs when a board member from one organization joins the board of a separate organization. This interlock forms a social network between board members, through which information, knowledge, practices, and policies flow between organizations. Academic research on for-profit entities suggests that interlocks are a conscious strategic choice made by organizations (Hallock 1997). We study board interlocks in the nonprofit sector. In doing so, we shed light on the impact of interlocking boards on nonprofit governance, organizational efficiency, and donations secured. Using a sample of more than 3,000 industry-diverse nonprofit organizations in the Washington, DC metropolitan area, we find that interlocked organizations have better governance practices and run more efficient operations, in line with the diffusion of best practices and shared knowledge and experience between organizations. Furthermore, we find that interlocked organizations report more donations, consistent with the expanded network provided by these relationships. Data Availability: The data used to perform this study are publicly available via GuideStar.
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