The Role of the Independent Accountant in Effective Risk Management

The purpose of this paper is to present a perspective on the ways in which an independent accountant can contribute to the management of risk in a business organization. Business conditions and challenges have heightened the interest in risk management by many stakeholders. Independent accountants have an important role to play in providing assurance related to the quality of risk management processes which extends beyond their traditional role as the auditor of financial statements. As organizations become more and more affected by externa1 and internal risks, and increasingly dependent on integrated information systems and the expansion of nonfinancial information for monitoring risk, the value of extemal assurance services should increase. However, while presenting an opportunity to the profession, the focus on risk management also comes with a few challenges, including obtaining market permission to provide risk-based assurance services, acquiring the necessary skills and expertise, avoiding regulatory intervention and maintaining independence as the scope of services provided by independent accountants increases. Overcoming these challenges should position the accountancy profession to well serve its clients in a broad array of risk-related services.

Female Audit Partners and Extended Audit Reporting: UK Evidence

This study investigates whether audit partner gender is associated with the extent of auditor disclosure and the communication style regarding risks of material misstatements that are classified as key audit matters (KAMs). Using a sample of UK firms during the 2013–2017 period, our results suggest that female audit partners are more likely than male audit partners to disclose more KAMs with more details after controlling for both client and audit firm attributes. Furthermore, female audit partners are found to use a less optimistic tone and provide less readable audit reports, compared to their male counterparts, suggesting that behavioural variances between female and male audit partners may have significant implications on their writing style. Therefore, this study offers new insights on the role of audit partner gender in extended audit reporting. Our findings have important implications for audit firms, investors, policymakers and governments in relation to the development, implementation and enforcement of gender diversity