Measuring Audit Firms＇ Intellectual Capital as a Determinant of Audit Quality： A Suggested Model

The intellectual capital is a main source of competing advantage. Many studies developed measure（s） of intellectual capital of industrial and service firms. Few studies have tried to develop a reliable measure of intellectual capital in audit firms. This study extends the current models to provide more insight into the role of intellectual capital in audit firms. The aim of this study is to develop a quantitative model to measure audit firms＇ intellectual capital. The suggested model can be used to explore the relationship between the intellectual capital in audit firms and audit quality. The model combines the main components of intellectual capital （human capital, structural capital, and relational capital）. The suggested model provides a tool that may help to better manage the intellectual capital in audit firms. As this is a theoretical study, a number of hypotheses are presented for testing in the future.

Audit Quality in Kazakhstan： Does Big 4 Provide High-Quality Audits？

This paper provides empirical evidence on audit quality in Kazakhstan as measured by audit tenure and the frequency of issuing modified opinions. In addition, an overview of audit institutions of Kazakhstan and an analysis of the current audit market for public companies are offered. This paper also sheds light upon the potential independence problems resulting in low audit quality and current barriers to audit researches in Kazakhstan. Consistent with the findings of extant researches on audit quality and the general perceptions of investors, two hypotheses were developed, i.e., the audits performed by Big 4 audit firms in Kazakhstan also have higher quality than non-Big 4 audit firms in terms of audit tenure and the frequency of issuing modified opinions. The result confirms the hypothesis that Big 4 audit firms provide higher audit quality than smaller local firms in association with audit tenure instead of in relation to the frequency of issuing modified opinions. The result indicates that Big 4 audit firms may not be as independent as they will be in a highly litigious market. Therefore, an independent inspection should be regularly implemented according to the audit law, and the inspection report should be publicized by Chamber of Auditors （COA）1. If this is not practical due to the lack of qualified inspectors, a peer review may be an altemative to implement the quality control policy immediately. To the author＇s best knowledge, this is the first audit quality research in countries of the Commonwealth of Independence States （CIS）.

Regional Variation in the SME-Audit Firm Relationship

The purpose of the paper is to examine how the relationship between small and medium sized enterprises （SMEs） and their auditor varies between regions. Auditing literature, regional, and network studies are used to set up hypotheses on differences between rural regions and the metropolitan urban region. Survey data from 421 SMEs are analyzed and findings support that in rural regions, especially those with a strong entrepreneurial culture and tight inter-organizational links, the SME-auditor relationship is to a larger extent trust-based compared to the urban region. In the rural region, the auditor assumes the role as a business support agent providing valuable strategic advice. The SME-auditor relationship is weakest in the urban region where the auditor＇s role is limited.

The analysis of determinants of going concern audit report

Going concern is one of essential things for user to make a financial decision. This research aims to explore factors that caused the issuance of going concern audit report by auditor. This research adds two new variables, audit size and audit committee, besides the other factors that cause auditor issue a going concern audit report. This research uses a regression logistic analysis to determine the relationship of each variable （liquidity, solvability, profitability, cash flow, audit firm size and audit committee） to going concern audit report. Different from previous researches, the results of this research show that liquidity, profitability, cash flow, and audit committee are not significant to influence the issuance of audit opinion. Audit size has a more significant relationship to audit opinion, while solvability is the most significant factor.

The Effect of Audit Objectives on Audit Quality Why is There Little Disclosure of Significant Deficiencies in Japanese Internal Control Audits？

Many prior research findings indicate that audit quality differs between the Big 4 and non-Big 4 audit firms using an indicator variable. However, most previous research focuses on only outcome measures, such as audit fees, going concern reports, and non-audit services. This study investigates audit quality differentiation between the Big 4 and non-Big 4 audit firms hypothesis from an audit objective point of view. One of the material objectives of Japanese internal control audit institutions is to facilitate assessment and improvement of internal controls by corporations themselves. The findings of this study indicate that the Big 4 audit firms accomplish this objective better than non-Big 4 audit firms. Consequently, most Big 4 clients do not disclose significant deficiencies （SDs）, implying that they improve the quality of internal controls through internal controls auditing. This paper concludes that Big 4 firms produce a higher audit quality level than non-Big 4 firms, and this quality difference iS related to how an audit objective is interpreted and implemented.

An Investigation into the Reorganization of the Big Four and the Consolidation of the Accounting Industry

The Big Four is the name given to the top four professional consultancy firms of the world namely Pw C(Price Waterhouse Coopers), KPMG, Ernst and Young and Deloitte. These firms provide audit, accounting, taxation, financial and other professional consultancy to the clients(being businesses and companies). The paper discusses the reasons for the formation of the Big Four and the future aspects of the big four. It was found that the current market structure and the existing status of the Big Four will not change in the near future and there is near to impossible chances of new entrants in the auditing and accounting markets because of barriers to entry established by the Big Four in the existing market.

An Empirical Study on CEO’s Academic Experience and Financing Constraints-Taking Shanghai and Shenzhen A-Share Listed Companies as Samples

Taking A-share listed companies in Shanghai and Shenzhen from 2007 to 2018 as samples,this paper analyzes the influence of CEO’s academic experience on corporate financing constraints.The empirical results show that there is a negative correlation between CEO’s academic experience and enterprise financing constraint level.Compared with state-owned enterprises,the academic experience of CEO in private enterprises is significantly negatively correlated with the level of corporate financing constraints.It also suggests that CEO’s academic experience can significantly reduce the level of financing constraints in the company samples audited by accounting firms(not Big 4).The conclusion of this paper is helpful to enrich the research of manager characteristics and corporate governance.At the same time,the research in this paper has reference significance for enterprises to ease the level of financing constraints.

The Factors Affecting Financial Reporting Reliability： An Empirical Research of Public Listed Companies in Thailand

The objective of this research is to examine the antecedents of financial reporting reliability of Thai-listed companies. Accountant professional ethics, accounting information system （AIS） quality, audit committee effectiveness, and audit firm quality are assumed to be the antecedents of financial reporting reliability. The listed companies in the Stock Exchange of Thailand （SET） are samples of the research. A mail survey procedure via the questionnaire was used for data collection from chief accountant officer. The overall results indicate that accountant professional ethics, AIS quality, audit committee effectiveness, and audit firm quality have a positive significant effect on financial reporting reliability. The results reveal that firms should develop accountant professional ethics, AIS quality, audit committee effectiveness, and audit firm quality in order to build reliable financial reporting. Overall, the results of this research contribute to chief accounting officers, accounting practitioners, and firms to emphasize development and support the generation of financial reporting reliability for financial reporting users.

UTR-CTOE： A New Paradigm Explaining CAATs Adoption

Computer assisted audit techniques （CAATs） are audit technologies that allow auditors to perform their audit work efficiently and effectively. However, little is known about CAATs adoption process by audit firms. Therefore, this paper adapts the technology readiness theory （TRI）, the unified theory of acceptance and use of technology （UTAUT） and the technology-organization environment （TOE） framework and Denison organizational culture theory, and presents a new theory of unified technology readiness and cultural-technological-organizational-environmental model （UTR-CTOE）, to explain CAATs adoption at both individual level and firm level. The methodology used in the study consists of a random sampling among the auditors through the administration of questionnaire. A total of 581 auditors registered with Mauritius Institute of Professional Accountants （MIPA） respond to the survey. Our main findings of this paper confirm that the relation between beliefs, such as perceived usefulness, perceived ease of use, facilitating condition and social influence, and motivation is positively correlated, while beliefs have a negative correlation with inhibition towards CAATs adoption. Results also indicate that firm＇s decision for CAATs adoption is positively influenced by cultural, technological, organizational, and environmental factors. Furthermore, there is an indirect impact of firm＇s internal and external influences on auditors＇ adoption of CAATs.