This paper aims to test the positive relationship between audit quality (AQ) of outsourced information technology controls (ITC) and information technology audit quality (ITAQ).
Factor analysis, ordinary least squares (OLS) regressions and simulations.
Scoping and planning phases of the audit cycle account for about 69 per cent of ITAQ. The AQ of outsourced ITC is strongly and directly related to ITAQ. Improvement of AQ of outsourced ITC may be achieved through evaluation of control design and operating effectiveness by service auditor as well as direct evaluation by the client in service provider location.
Sample size and input items in factor analysis.
Companies and auditors could improve ITAQ through a better organization of the scoping and planning activities; they could also improve the AQ of outsourced ITC using direct evaluation in the service provider location supplemented with service auditor reports. Regulators could refine or change laws and frameworks to take into account the factors of ITAQ and the methodology of evaluation of outsourced ITC.
Private data collected by questionnaire. The measures of ITAQ and the OLS model could be tested in future research, in countries with different frameworks and regulations related to AQ, different weight of outsourced information technology and other characteristics related to clients, service providers and service auditors.
The authors thank the anonymous referees for their relevant suggestions and the joint editors Barry J. Cooper, Philomena Leung and Nonna Martinov-Bennie of Managerial Auditing Journal. The authors thank Prof Anne Gold (Vrije Universiteit, Netherlands), and the participants at the International Association for Accounting Education and Research (IAAER) Conference Mastering Change, Improving corporate reporting and auditing to match new demands, Vrije Universiteit, Amsterdam (Netherlands), 19-21/06/2012, for their useful comments and suggestions. They also thank the participants at the Workshop on Internal Controls over Financial Reporting and Information Technology Controls, Parma University, Italy, 6/12/2012. Finally, they thank Prof Giovanni Fattore (Bocconi University – Milan – Italy) for the helpful suggestion on social sciences research methods (September-December 2011).
Mazza, T., Azzali, S. and Fornaciari, L. (2014), "Audit quality of outsourced information technology controls", Managerial Auditing Journal, Vol. 29 No. 9, pp. 837-862. https://doi.org/10.1108/MAJ-10-2013-0956Download as .RIS
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