David Hay, Elizabeth Rainsbury and Debbie Van Dyk
The purpose of this study is to examine the cost of the introduction of independent audit inspections in New Zealand.
Abstract
Purpose
The purpose of this study is to examine the cost of the introduction of independent audit inspections in New Zealand.
Design/methodology/approach
The research is conducted using audit fee data from New Zealand and examines the overall impact of the reforms on the cost imposed on auditees.
Findings
The findings show that there was no general increase in audit fees but a significant increase in audit fees for small listed companies compared to audit fees for unlisted companies and large listed companies.
Practical implications
The practical implications of this study suggest that the introduction of independent inspections led to increased costs for some clients, particularly smaller listed companies, and that audit firms were able to pass on these costs to their clients. These results have important implications for policymakers and auditors alike.
Originality/value
This study provides new insights into the cost of the introduction of independent audit inspections, which have been the subject of ongoing criticisms and recommendations for improvement.
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Elizabeth Rainsbury, Saman Bandara and Ahesha Perera
New Zealand regulatory bodies guided preparers and auditors of financial statements to deal with potential COVID-19 impacts on the financial statements and audit procedures. This…
Abstract
Purpose
New Zealand regulatory bodies guided preparers and auditors of financial statements to deal with potential COVID-19 impacts on the financial statements and audit procedures. This study provides evidence of auditors' response to the impact of COVID-19 on the reporting of key audit matters (KAMs) in audit reports of listed companies in New Zealand. The purpose of this paper is to address this issue.
Design/methodology/approach
A sample of 50 New Zealand listed companies was selected to compare the KAMs in 2019 (pre-COVID-19) and 2020 (during COVID-19). The study uses content analysis to evaluate the KAMs’ disclosures and descriptive analysis to examine the differences between 2019 and 2020 in terms of the auditor type, industry sector and accounting standards.
Findings
Auditors responded positively to the request from regulators to communicate the impacts of COVID-19. The findings show an increase in the amount and length of KAMs in 2020 compared to 2019, with 82% of companies and 61% of KAMs reporting the impact of COVID-19. The real estate and information technology sectors disclosed more on the impact than other sectors. In analysing the KAMs, accounting standards for inventories, property plant and equipment, impairment of assets, investment property, revenue from contracts with customers and leases were highly affected by COVID-19.
Practical implications
The findings support regulators to evaluate how well auditors communicated matters relating to COVID-19 in the audit report. Also, the findings will help standard setters to identify key accounting standards affected by COVID-19 of KAMs and provide insights to users on how the KAM reporting enhances communicative value during the pandemic.
Originality/value
The current study captures the impact of COVID-19 on the reporting of KAMs by comparing changes before and during the pandemic.
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Elizabeth Rainsbury, Sidney Weil and Peter Oyelere
This paper reports on a study of the efficacy of the Institute of Chartered Accountants of New Zealand's (the Institute) Professional Accounting School (PAS) programme in…
Abstract
This paper reports on a study of the efficacy of the Institute of Chartered Accountants of New Zealand's (the Institute) Professional Accounting School (PAS) programme in developing a set of competencies in candidates. The study surveyed Institute candidates' perceptions of their competence levels for 16 specified skills at the commencement and conclusion of the 1999 PAS programme. The findings indicate that candidates perceived their levels of competence, for both cognitive and behavioural skills, to have been significantly improved by the PAS programme. Tests of two secondary hypotheses in the study indicate certain gender‐ and firm‐based differences in the perceived level of competence of candidates. The results of the study provide the Institute with feedback on the PAS programme and facilitate the further development of the programme. Other professional accounting bodies may consider replicating this study using data collected on similar programmes. The results of such studies may then be compared to enhance the existing knowledge of competency development in professional accounting education.
This study examines factors related to audit committee membership for a sample of large New Zealand listed companies. This study reveals that non‐executive directors who are…
Abstract
This study examines factors related to audit committee membership for a sample of large New Zealand listed companies. This study reveals that non‐executive directors who are independent, and directors with financial expertise, are more likely to be members of audit committees. The results are consistent with the New Zealand Securities Commission’s corporate governance guidelines for audit committees of New Zealand listed companies. However, in the current New Zealand regulatory environment, directors with accounting expertise can include non‐executives affiliated with the firm. In these situations the financial expert is not independent. Remuneration committee members are found more likely to be members of the audit committee. This may be a result of their power and influence or be due to the skills they bring. The number of years that directors serve on the board, the number of other directorships they hold, and the number of shares they own in the company are not related to audit committee membership.
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Seirgei Miller, Theo C. Haupt and Nicholas Chileshe
The cooperative education model adopted by Universities of Technology in South Africa embodies the notion that both education and training are equally essential. It incorporates…
Abstract
The cooperative education model adopted by Universities of Technology in South Africa embodies the notion that both education and training are equally essential. It incorporates productive work into the curriculum as a regular and integral element of a higher education course. The present model involves three cooperative partners namely, the university, student and employer. It should, therefore, be evident that cooperative education has two main components, namely an academic component and an experiential learning component, both of which are integral to its success. To enable students to understand the relationship between academic subjects and the world of work, cooperative education involves restructuring the educational experience. For some time, industry employer representatives have suggested that education and training offered at Universities of Technology do not always address the needs of industry. They argue that graduates lack the necessary theoretical skills, training and managerial understanding to ensure immediate meaningful employment. These inadequacies contribute to unemployment and the lack of advancement opportunity within their chosen careers. In addition, there is a need to examine the perceptions of students regarding course content before they go into industry. This was the motivation for this research. The aims of the research project are twofold. Firstly, to examine the course content offered within the civil engineering diploma programme, and secondly to measure the levels of subject satisfaction. Using an exploratory approach through a survey of 123 students, this study explores the course content and satisfaction levels based on study areas in the first year program. The results indicate that students generally perceive the subject Communication Skills to be least satisfying whereas Mathematics is considered to be the most satisfying subject. This paper concludes by presenting the subject satisfaction index tool which contributes to the range of intervention strategies as envisaged by the CIDB. This further contributes towards the improvement of the overall quality of University of Technology civil engineering academic programs and also the subsequent productive employability of its graduates.