Analytical procedures for new and matured industries

Abstract

Examines the impact of client industry on the use and effectiveness of audit analytical procedures. Segregates audit client firms into two industry categories ‐ new and matured. Posits that the industry category the client firm is operating in will have a substantial effect on the extensiveness, types and effectiveness of analytical procedures employed. In particular, hypothesizes that analytical procedures will be more extensively and effectively used in the audit of firms in matured industries. Further, hypothesizes that trend analysis will be used primarily in the audit of firms in matured industries while visual scanning of data and ratio analyses will be used in the audit of firms in both new and matured industries. The results of a questionnaire survey distributed to one of the Big Six audit firms in Singapore support the above hypotheses.

Citation

Min Choo, T., Keong Chua, M., Boon Ong, C. and Hee Tan, T. (1997), "Analytical procedures for new and matured industries", Managerial Auditing Journal, Vol. 12 No. 3, pp. 123-134. https://doi.org/10.1108/02686909710160997