Newsletter September 2020

In this newsletter: 

• Reminder: Online FAR Masterclass by Professor Jasmijn Bol on "The effect of audit culture on audit quality" – 16 October 2020
• Q&A follow up session FAR Conference with Professor Marshall Geiger
• FAR Practice note and paper by Professor Alain Schatt and Professor Jean Bédard on the “Economic consequences of joint audit”
• FAR Literature review on “Internal Control Quality and Audit Quality” by Prof. Dr. Christian Hofmann and his team
• ESB publication “Accountants doorgelicht” presented to the Dutch House of Representatives (NED)
• Upcoming events – save the dates! 
• Other 

Reminder: Online FAR Masterclass by Professor Jasmijn Bol on "The effect of audit culture on audit quality" – 16 October 2020
On Friday, 16 October 2020, from 4:00 – 5:30 pm CET, FAR will organize an online Masterclass by Jasmijn Bol, who is a Professor at Tulane University.

In business, employees are one of the most important drivers of success. Audit firms, in particular, rely greatly on employee cooperation and know-how to achieve organizational objectives. As a result, smart audit firms motivate and guide staff members to organizational goals. Without proper motivation and guidance, employees take actions that may not enhance organizational value or may even take actions that destroy value. Importantly, this does not necessarily suggest that they engage in fraud or intentional negative behavior, because value also evaporates, for example, when employees simply prioritize the wrong actions on a busy day. To mitigate these motivation and direction concerns, effective audit firms use a management control system. In this research study, the project team examines how Dutch audit firms use their management control system to motivate and direct auditors’ efforts towards audit quality.  

You can register for this Masterclass until Thursday 15 October 11:00 pm CET via this link.

Q&A follow up session FAR Conference with Professor Marshall Geiger
The audience participation during our online conference was so vibrant, that there was not sufficient time to answer all the questions raised during the separate sessions. 

In this follow-up Q&A Professor Marshall Geiger (Professor of Accounting and the CSX Chair in Management and Accounting and Professor of Accounting at the University of Richmond, US) addresses all remaining questions that were posed during their session on going concern opinions. You can listen to it here.

FAR Practice note and paper by Professor Alain Schatt and Professor Jean Bédard on the “Economic consequences of joint audit”
During our international conference on 22 June of this year, Professor Alain Schatt (University of Lausanne) gave a presentation about the ‘Economic consequences of joint audit’.

The practice note and full report, written with co-author Professor Jean Bédard, are now available, you can read it here.

For the presentation slides that were used at the conference, click here. If you are interested in seeing and listening to the full video of the presentation of that day, please click here. 

If you would like to have more information about the conference, the summary and videos of the conference can be found here.

Literature review on “Internal Control Quality and Audit Quality” by Prof. Dr. Christian Hofmann and his team
The document provides an overview of literature on the association between internal control quality and audit quality. First, the team examined the existence and relevance of internal control weaknesses in firms. Second, the team characterizes auditor’s assessment of internal controls and the consequences of audit failure for both the auditor and the client firm. Finally, Christian Hofmann and his team members analyze the role of financial analysts as a potential information source for auditors to assess the quality of firms’ internal control systems.    

You can read the full literature review here.

ESB publication presented to the Dutch House of Representatives (NED)
Henriëtte Prast, chairman of the Foundation for Auditing Research (FAR), together with FAR managing director Jan Bouwens, presented the ESB dossier 'Accountants doorgelicht’ to the House of Representatives on Monday 21 September 2020.

This publication examines the current and future desired social contribution of the work of the accountant. It was initiated by FAR and edited by ESB.

The articles reflect the various forces that affect the role and quality of the auditor’s work, such as cooperation throughout the entire chain of corporate reporting and assurance, the complexity of judgment and decision-making in auditing, the work of supervisors and the influence and expectations of the Supervisory Board. The articles contribute to a more informed debate about the future of the auditing profession.

The articles in this issue were written by scholars at universities who study the quality and social significance of the work of the auditor or by authors working in auditing practice.

You can look and listen to the (virtual) presentation of the ESB publication here (approx. 15 min).

You can download and read the publication here (NED).

Upcoming events – save the dates!
Online FAR Masterclass – Professor Jasmijn Bol

On Friday 16 October 2020 FAR will host the online Masterclass by Jasmijn Bol. You can read all about it in the first item of this newsletter.

Announcement: Online FAR Masterclass – Professor Mark Peecher
On Friday 4 December 2020 FAR will host an online Masterclass by Mark Peecher on “Improving audit quality by enhancing auditor’s detection of markers of management deception”.

FAR International Conference 2021
We hope to see you all live next year at the FAR Conference on 21 and 22 June 2021 in Breukelen, the Netherlands. Please save the date in your calendar!”¯ 

Other
Besides this newsletter and news related to events, we regularly publish literature reviews and practice notes on our website. Of course, you can read all about it in our newsletter, but please also make sure to check out these updates on our LinkedIn page as that is where we also share new podcasts and other articles.  

Want to be the first to know? Then don't forget to follow our LinkedIn page. 

Do you have suggestions on how to improve our newsletter or news you would like to share with us? Please let us know by sending an email to info@foundationforauditingresearch.org