Auditors Compliance with International Standards on Auditing (ISAs): Evidence form Jordan

Obaidat, .; Ahmad, Norkhazimah

doi:10.3844/jssp.2007.185.189

Cited by 8 publications

(2 citation statements)

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“…The finding of this study consistent with Obaidat (2007) who found that Jordanian external auditors comply with the ISAs and aware of their importance on audit quality. Although Obaidat"s study showed that ISA 260 gained a low rank of compliance, in comparison with the other standards, this however, could be explained to the fact that his study was conducted before the establishment of the first version of the Jordanian corporate governance code for public shareholding companies in 2009, which has vested the audit committee a significant role in facilitating the work of the external auditors and organized the mechanism of the communication between auditors and the company.…”

Section: Conclusion and Discussionsupporting

confidence: 90%

“…Jordan was an early reformer in terms of adopting accounting standards, auditing standards, and corporate governance initiatives in the region (Obaidat, 2007;Shehata, 2015;Al-Frijat, 2016). Obaidat (2007) investigated Jordanian auditors" compliance with the ISAs. A questionnaire was designed by listing all auditing standards and sought auditors" views about the extent of their compliance with the standards.…”

Section: Introductionmentioning

confidence: 99%

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International Standard on Auditing No. 260 and Audit Quality: Evidence from Jordan

Shbeilat¹

2019

IBR

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This study aims to explore the extent of external auditors awareness of the requirements of the International Standard on Auditing No. 260 (Communications with those charged with governance) on audit quality and to shed light on the effectiveness of the communication process based on auditors actual experience. A mixed method approach was employed to achieve the study objectives. The analysis of 116 questionnaires concluded that the requirements of the ISA 260 enhance audit quality, but the two-way communication between Jordanian auditors and the audit committee is ineffective from external auditor’s perception. The study also found that audit committees do not support external auditor when disagreements arise between auditors and their client management on accounting treatments. The qualitative interviews confirmed the quantitative results and revealed several explanations among which: 1) lack of qualified directors, 2) lack of a clear policy in selecting board members, 3) meetings with auditors are routinely held, and 4) insufficient oversight by the securities commission. The interviews also revealed that the recent version of Jordanian corporate governance has two potential factors have been viewed to improve the effectiveness of the communication process that are, the appointment of a ‘governance liaison officer’ who, among other responsibilities, supervise and document audit committee meetings with the auditor, and the use of cumulative voting technique in selecting board members. The findings of the study could be beneficial for regulators by ensuring the best implementation of cumulative voting to increase the representation of qualified members so that the communication process will be greatly enhanced.

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Section: Conclusion and Discussionsupporting

confidence: 90%

Section: Introductionmentioning

confidence: 99%

International Standard on Auditing No. 260 and Audit Quality: Evidence from Jordan

Shbeilat¹

2019

IBR

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Accounting legislation, corporate governance codes and disclosure in Jordan: a review

Haddad

Sbeiti

Qasim

2017

IJLMA

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Purpose The main aim of this paper is to provide an overview of the most influential economic changes and accounting legislation affecting financial reporting and disclosure practices in Jordan. It also provides an overview of disclosure studies conducted in Jordan covering the year(s) between 1986 and 2014 to investigate whether there is an improvement in disclosure practice in Jordan. This paper also investigates the most influential firm characteristics affecting disclosure practices in Jordan found in prior disclosure studies that were conducted in Jordan between 1986 and 2014. The paper also addresses the disclosure items required in Corporate Governance Codes that exist for listed shareholding companies, banks and insurance companies. Finally, the paper discusses the quality of accounting education in Jordan, as prior studies noted its impact on accounting practice. Design/methodology/approach Based on a review of prior disclosure studies conducted in Jordan between 1986 and 2014, this study compared the results of disclosure studies before and after 1998. In 1997, Jordan, as a result of economic changes, issued the Temporary Securities Law and its Directives of Disclosure, which came into effect in 1998. The law is considered as the turning point in the improvement of disclosure practice in Jordan. A trend line of disclosure practice is also used to investigate whether disclosure practice is improved after the issuance of this law. A descriptive analysis is also used to examine the factors affecting disclosure practice in Jordan. Findings Based on a review of prior disclosure studies, it was concluded that disclosure practices have improved overtime. It was also observed that that firm size as a factor has always affected the level of disclosure in Jordan and is followed by external auditing, while liquidity is found to have the least effect. It was concluded that economic changes, agreement with international organizations like the World Trade Organization (WTO) and the International Organization of Securities Commissions (IOSCO), new regulations and financial market reforms have improved disclosure practice in Jordan. It was also found that there is a need for further studies in disclosure practice that are not sufficiently covered in Jordan. Originality/value The study is based on a review of disclosure studies conducted in Jordan between 1986 and 2014. We investigate whether mandatory, voluntary, corporate social and internet disclosure practice improved over the last three decades in Jordan. This study is the first to provide evidence on the improvement of disclosure practices based on a review of disclosure studies in Jordan. The paper is expected to be a reference for disclosure studies in developing countries, Jordan in particular, as it summarized and criticized the weaknesses on disclosure practice and accounting legislations in Jordan.

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Financial market consequences of early adoption of international standards on auditing: international evidence

Elmghaamez

Gerged²,

Ntim

2020

MAJ

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Purpose This paper aims to investigate the effects of the early adoption of International Standards on Auditing (ISAs) on Financial Market Indicators (FMIs) from a diffusion of innovation (DOI) theory perspective. Design/methodology/approach Using panel data from 110 countries in a period that spans from 1995 to 2014, this study applies an ordinary least squares regression model to investigate the financial consequences of adopting ISAs. This analysis was supplemented with estimating a fixed-effects and two-stage least squares regression models to address any concerns regarding the possible existence of endogeneity problems. Findings This study reports three key findings. First, the authors find that early ISAs adoption has a negative effect on several financial market consequences, namely stock market integration, market capitalisation, market turnover, market return, market development, stock price volatility and stock trading volume. Second, using an alternative measure to the one that is proposed by DOI theory, the authors found that some financial indicators have been significantly improved after ISAs adoption, but only for listed firms that prepared their financial statements under International Financial Reporting Standards and audited by ISAs simultaneously. Finally, the financialindicators of European stock markets, however, have insignificantly shrank post the mandatory adoption of ISAs in 2006. Practical implications The empirical evidence raises questions about how ISAs were enforced and implemented. For example, countries that adopted ISAs at early stages may have been dominated mostly by recently established stock exchanges. This implies a crucial need to determine and apply the best type of auditing regime that can increase investors trust and enhance the credibility of stock markets information, which might ultimately advance the FMIs over time significantly. Originality/value To-date, studies investigating the impact of the adoption of ISAs on FMI from a DOI theory perspective are virtually non-existent. The study, therefore, seeks to contribute to the extant literature by examining the influence of ISAs adoption on a wide range of FMIs.

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Auditors Compliance with International Standards on Auditing (ISAs): Evidence form Jordan

Cited by 8 publications

References 0 publications

International Standard on Auditing No. 260 and Audit Quality: Evidence from Jordan

International Standard on Auditing No. 260 and Audit Quality: Evidence from Jordan

Accounting legislation, corporate governance codes and disclosure in Jordan: a review

Financial market consequences of early adoption of international standards on auditing: international evidence

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