Teaching audit reports: A flowchart approach

The effective and efficient communication of audit report material for historical generally accepted accounting principles (GAAP)-based financial statements is a challenging task for auditing educators. A sizable number of auditing standards focus on this subject matter. Moreover, several recent expectation-gap standards, notably Statement on Auditing Standards (SAS) No. 58, impact directly on the reporting issue. Two instructional issues are of concern with regard to audit report materials. They are (a) the complexity of the material and (b) timing-when this material should be presented. With respect to the complexity issue, SAS No. 58 and related standards are so complex that many auditing students are overwhelmed by the topic. With regard to timing, some instructors feel a need to communicate an overview of the reporting process when the topic is first introduced and then deliver a more detailed discussion later in the course. To address the complexity and timing issues, this paper illustrates two different levels of flowcharts. These materials may be used in the classroom by accounting educators to effectively communicate the set of reporting conditions and the related audit report responses

An Empirical Analysis Of The Accounting Information Systems Course

This article reports the results of a survey of faculty teaching the accounting information systems (AIS) course and of their chairpersons that focused on institutional, course-related, and instructor-related factors. Almost half the instructor respondents were assistant professors, low proportion of the instructors indicated a primary or secondary research interest in AIS, and a large proportion of respondents indicated that they were self-trained in AIS. The most frequently used text was instructor-prepared class notes. Most respondents covered internal control, AIS concepts, and the revenue and expense cycles. A smaller proportion of instructors covered data modeling and database topics, and this coverage was associated with instructors at larger schools and having research interests in AIS. Most instructors assigned computer projects. Respondents also indicated that they thought the AIS course was more difficult to teach than other accounting courses

A continuous auditing web services model for XML-based accounting systems

This article discusses how emerging information technology (IT) frameworks, such as extensible markup language (XML) and Web services, can be utilized to facilitate continuous auditing for the next generation of accounting systems. Relying on a number of components of Web services technology, this article presents a new model for continuously audit business processes, referred to as continuous auditing web service (CAWS). The CAWS mechanism would run as a web service in the audit firm\u27s computing environment and could be applied at a very granular level to provide assurance about specific business processes, at a very aggregate level for providing assurance relating to continuously reported earnings, or to provide continuous assurance (CA) about the operation of internal controls resident in the audit client\u27s environment. The primary user of CAWS, given the current audit model, is the audit firm itself. However, the proposed CAWS approach facilitates a new pull model of auditing as envisaged by Elliot [Account. Horiz. (1992) 61], where assurance consumers invoke the CAWS routines to obtain assurance on demand. In such a model, the auditor would offer restricted views provided by the CAWS routines on a fee basis to analysts, investors, financial institutions, and other parties interested in obtaining CA of business performance or other audit objects of interest. The frameworks and technologies that facilitate such a Web-service-based continuous auditing mechanism in an XML-enhanced world are briefly described. The article concludes with suggestions for future research

Understanding risk-taking behavior of groups: A “decision analysis” perspective

Past research has extensively investigated the effect of media, especially focusing on how anonymity increases risk-related behaviors of groups when using computer-mediated communication (CMC). This study extends prior research by examining the differences in group risk-taking behaviors between face-to-face groups and completely non-anonymous CMC groups (i.e., groups working in a fully identified, synchronous CMC environment similar to popular instant messaging systems utilized widely within organizations). Drawing on the “decision analysis” perspective, a key framework for understanding organizational decision-making, the study also examines the effects of the firm\u27s risk preferences as well as the type of information distribution among group members (i.e., full information known to all group members versus partial information know by only some of the members) on the groups\u27 risk-taking behaviors. Results from a laboratory experiment using student subjects found no differences in risk-taking behaviors between CMC and face-to-face groups; additionally, no differences were found related to how information was distributed among group members. A significant effect was found, however, for the risk preference of the firm, showing that risk-neutral firms influenced groups to make riskier decisions than groups from risk-averse firms. Finally, groups within risk-neutral firms receiving partial information made riskier decisions than groups receiving full information. The implications of these results for future research and practice are examined