Audit risk model as a corporate social responsibility implementation of certified public accounting firms (evidence from Indonesia)

Audit risk model as a corporate social responsibility implementation of certified public... Purpose – The conduct of this research represents part of an effort to modify audit risk model (ARM) as an implementation of corporate social responsibility (CSR) by certified public accounting (CPA) firms. It is intended to make clear the phenomena about the relationship between audit risk (AR), implementation of business ethics principles (IBEP) and corporate governance risk (CGR). Design/methodology/approach – The method used was hypothesis testing. Unit of analysis was individual (i.e. Indonesian CPA), and the gathering of data was cross‐sectional. The sample was determined by purposive sampling. Data were collected using questionnaires, and data analysis was conducted by structural equation modeling (SEM). Findings – According to Indonesian CPAs' perception, the AR is affected by the client's CGR, whereas the client's IBEP does not affect AR, but clients' CGR and IBEP both significantly affect AR. It is suggested: first, that the next researcher should study audit risk related to business ethics. Second, that the management should strengthen the implementation of business ethics in running a business; and finally that the Bapepam (Capital Market Oversight Board) should oversee both public company and public accountant in the implementation of governance. Research limitations/implications – This research noted some implications, including: nature and intensity of gathering data, restricted respondent (CPA‐CMAF), and restricted variables of corporate governance (BoD, and Audit Committee). Originality/value – This research suggests the necessity to modify ARM by dividing inherent risk into errors risk and fraud risk as bases for accumulating audit evidence. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Social Responsibility Journal Emerald Publishing

Audit risk model as a corporate social responsibility implementation of certified public accounting firms (evidence from Indonesia)

Social Responsibility Journal, Volume 7 (3): 14 – Aug 2, 2011

Loading next page...
 
/lp/emerald-publishing/audit-risk-model-as-a-corporate-social-responsibility-implementation-8rHjIQnMeg
Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
1747-1117
DOI
10.1108/17471111111154590
Publisher site
See Article on Publisher Site

Abstract

Purpose – The conduct of this research represents part of an effort to modify audit risk model (ARM) as an implementation of corporate social responsibility (CSR) by certified public accounting (CPA) firms. It is intended to make clear the phenomena about the relationship between audit risk (AR), implementation of business ethics principles (IBEP) and corporate governance risk (CGR). Design/methodology/approach – The method used was hypothesis testing. Unit of analysis was individual (i.e. Indonesian CPA), and the gathering of data was cross‐sectional. The sample was determined by purposive sampling. Data were collected using questionnaires, and data analysis was conducted by structural equation modeling (SEM). Findings – According to Indonesian CPAs' perception, the AR is affected by the client's CGR, whereas the client's IBEP does not affect AR, but clients' CGR and IBEP both significantly affect AR. It is suggested: first, that the next researcher should study audit risk related to business ethics. Second, that the management should strengthen the implementation of business ethics in running a business; and finally that the Bapepam (Capital Market Oversight Board) should oversee both public company and public accountant in the implementation of governance. Research limitations/implications – This research noted some implications, including: nature and intensity of gathering data, restricted respondent (CPA‐CMAF), and restricted variables of corporate governance (BoD, and Audit Committee). Originality/value – This research suggests the necessity to modify ARM by dividing inherent risk into errors risk and fraud risk as bases for accumulating audit evidence.

Journal

Social Responsibility JournalEmerald Publishing

Published: Aug 2, 2011

Keywords: Audit risk model; Corporate social responsibility; Certified public accounting firms; Audit risk; Corporate governance; Business ethics

References

  • Causes and consequences of earnings manipulation: an analysis of firms subject to enforcement actions by the SEC
    Dechow, P.M.; Sloan, R.G.; Sweeney, A.P.
  • CFO intentions of fraudulent financial reporting
    Gillet, P.R.; Uddin, N.

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create folders to
organize your research

Export folders, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off