Audit education role in decreasing the expectation gap

Fülöp, Melinda Timea; Tiron-Tudor, Adriana; Cordoș, George Silviu

doi:10.1080/08832323.2018.1527752

Cited by 28 publications

(39 citation statements)

References 11 publications

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“…There are many prior studies both in developed and emerging countries on the subject of audit expectation gap. These studies [3,9,11,22,26,41,51,54,61,68] mostly used survey questionnaire to identify the inherent attributes of the gap, its effects, and ways of narrowing it. The research studies outcomes largely showed the presence of users misunderstanding as regards auditor's duties and responsibilities.…”

Section: Empirical Reviewmentioning

confidence: 99%

“…They also discovered that the use of long-form of auditors' report would significantly affect beliefs and consequently reduce the gap, but new contrasts in beliefs may emerge. Fulop et al [22] also examined audit education role in reducing the expectation gap. Their findings indicated that audit education has a significant impact in constraining the 'audit reasonableness expectation gap' .…”

Section: Empirical Reviewmentioning

confidence: 99%

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Audit expectation gap: an empirical analysis

et al. 2020

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The financial debacles that occurred in the companies like Enron, WorldCom, and Xerox in the USA, Lehman Brothers, Polly Peck in the UK and African Petroleum Plc., Cadbury Plc., in Nigeria had created public distrust with the auditors. The era when the auditor will say 'trust me' and that being accepted is over. Now, they must earn the public trust. This study provides an empirical analysis of the scope and nature of audit expectation gap in Nigeria. We used a descriptive and survey research design to achieve the objective of the study. We also collected data through primary source, using structured questionnaire. The study used Mann-Whitney U test and Kolmogorov-Smirnov Z test for the analysis of data and test of normality of distribution, respectively. The results confirmed that audit expectation gap exists in Nigeria, and the new auditor's report did not have any serious impact in reducing the gap. From the outcome of this study, the audit expectation gap primarily arose from the unreasonable expectation of the users due to their lack of understanding of the roles of auditors. We recommend the launching of a new business-reporting model geared towards releasing more non-financial information to the public and with clear description of the role of independent audit.

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Section: Empirical Reviewmentioning

confidence: 99%

Section: Empirical Reviewmentioning

confidence: 99%

Audit expectation gap: an empirical analysis

et al. 2020

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“…According to Fulop, Tiron-Tudor, and Cordos (2019) reasonableness gap is the most difficult part of the audit expectation gap to be reduced as it is related to the beliefs and perceptions of various groups of stakeholders. The standard deficiency gap can be reduced by improving standards to meet the reasonable expectations and fulfill the need of financial statements' users.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Researchers attempted to find possible solutions to narrow the gap of perceptions on the auditors' responsibility for fraud detections and emphasized the role of education (De Muylder, Hardies, & Breesch, 2012;Fulop et al, 2019;Kumari, Ajward, & Dissabandara, 2017;Rehana, 2010;Siddiqui, Nasreen, & Choudhury-Lema, 2009), introducing new auditing standards (Christopher Humphrey et al, 1993;Salehi, 2011), monitoring auditors' performance (Porter et al, 2012), and the expansions of auditors' responsibility (Teck Lee et al, 2009). Researchers have identified many other factors and suggested several actions to reduce the gap, yet the most recent research on the audit expectations have confirmed the prevalence of the gap in all countries in which those studies were conducted.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Research that has explored the perception of graduate students with accounting and auditing background confirmed the existence of the gap among the students' groups. It is therefore unlikely for other groups of financial statements' users and other stakeholders to understand the duties of auditors and acquire reasonable expectations of their responsibilities (Fulop et al, 2019).…”

Section: Literature Reviewmentioning

confidence: 99%

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Auditors’ responsibility for fraud detection: Views of auditors, preparers, and users of financial statements in Saudi Arabia

Al-Dhubaibi¹

2020

10.5267/j.ac

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The purpose of this study is to explore the views of independent external auditors, financial statements' preparers and financial statements' users regarding the general responsibilities of auditors with a focus on their responsibility for fraud detection. A structured questionnaire survey was used as an instrument to collect data for this purpose. A total of 1,015 questionnaires were sent to three categories of respondents whereas 261 valid responses were received with an overall response rate of 26%. The findings of this study revealed a substantial audit expectation gap in Saudi Arabia with regards to auditors' responsibilities in general and their responsibility for fraud detection in particular. Preparers of financial statements and users as well assume that auditors provide an absolute assurance that audited financial statements are free from material misstatements including fraud. In contrast to auditors' perception, preparers and users of financial statements believe that auditors should be made liable to audit beneficiaries for losses if failed to disclose potential fraud in the audit report or for any subsequent discovery of misstated audited financial statements. This study contributes to the audit profession in Saudi Arabia by highlighting the presence of a serious expectation gap that may adversely affect the value of audit function and the reputation of auditors in Saudi Arabia. The implications of these findings should motivate professional bodies and other interested parties to cooperate and work closely to reduce the gap and find a convergence between auditors and audit beneficiaries about the role and responsibilities of auditors.

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Audit expectation gap: a comprehensive literature review

Deepal

Jayamaha

2022

AJAR

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PurposeThis paper reviews a substantial body of scholarly work on the audit expectation gap (AEG) for many years and aims to construct a new synthesis of the existing knowledge of the AEG discovered by numerous scholars in the world.Design/methodology/approachA broad search of the literature was conducted using a few AEG related keywords in the Google Scholar search engine and two databases of Scopus and Emerald from 1974 to 2021. Only the articles published in reputable journals concerning the AEG were selected after applying some selection criteria.FindingsThe concept of AEG is a multidimensional concept. Different causes for the AEG were identified, and several strategies were summarized into major promising strategies for narrowing it. It was found that the AEG cannot be eradicated entirely from society.Practical implicationsThis review of the literature will be of interest to auditors, financial statement users, regulatory agencies, and policymakers, among other parties. Further, this AEG synthesis may be useful in understanding misperceptions and determining how they differ across diverse stakeholders.Originality/valueThere is a dearth of literature review studies incorporating all the facets of AEG. Hence, this study incorporates all those facets, namely research methods and instruments and dimensions used along with causes and mechanisms to narrow down the AEG while addressing the gaps and highlighting the themes for future research. Finally, a fresh, yet more straightforward definition was generated as a result of the comprehensive review of the literature, adding novelty to the extant literature.

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Audit education role in decreasing the expectation gap

Cited by 28 publications

References 11 publications

Audit expectation gap: an empirical analysis

Audit expectation gap: an empirical analysis

Auditors’ responsibility for fraud detection: Views of auditors, preparers, and users of financial statements in Saudi Arabia

Audit expectation gap: a comprehensive literature review

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