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1 – 10 of 138Ewald Aschauer and Reiner Quick
This study aims to investigate why and how shared service centres (SSCs) are implemented as well as how they affect audit firm practice and audit quality.
Abstract
Purpose
This study aims to investigate why and how shared service centres (SSCs) are implemented as well as how they affect audit firm practice and audit quality.
Design/methodology/approach
In this qualitative study guided by the theoretical framework of institutional theory, the authors conducted 25 semi-structured interviews in seven European countries, including 16 interviews with audit partners from Big 4 firms, 6 with audit team members, 2 with interviewees from second-tier audit firms and 1 with a member of an oversight body.
Findings
The authors show that the central rationale for audit firms to implement SSCs is economic rather than external legitimacy. The authors find that SSC implementation has substantial effects on audit practices, particularly those related to standardisation, coordination and monitoring activities. The authors also highlight the potential impacts on audit quality.
Originality/value
By exploring the motivation for and effects of SSC implementation amongst audit firms, the authors offer insights into the best practices related to subsequent change processes and audit quality.
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Faisal Alshahrani, Baban Eulaiwi, Lien Duong and Grantley Taylor
This study aims to examine the relationship between climate change disclosure performance (CCDP) and audit pricing. The moderating effect of corporate governance characteristics…
Abstract
Purpose
This study aims to examine the relationship between climate change disclosure performance (CCDP) and audit pricing. The moderating effect of corporate governance characteristics on that relationship is also investigated.
Design/methodology/approach
Using a sample of top 300 Australian Securities Exchange listed non-financial firms over the period 2008–2019, this study investigates the association between CCDP and audit fees. The findings are robust to a difference-in-difference test thereby alleviating potential endogeneity concerns.
Findings
CCDP is found to be significantly positively related to external auditor fees.
Research limitations/implications
The findings show some important implications for firm management, regulators, investors and auditors. This study presents empirical evidence that climate change, as a factor of external risk, influences audit fees.
Practical implications
Firms with governance structures characterized by larger more independent boards, larger audit committees and audit committees with a higher level of independence significantly moderate the relationship between CCDP and audit fees.
Social implications
Investors’ demand for firm transparency and disclosure of information regarding the risks of climate change, effects and opportunities has increased significantly over the past decade, as these factors could have a significant effect on valuation and investment decisions.
Originality/value
Importantly, stakeholders need to be aware of the costs of climate change, the quantification of climate change impacts and how firms address climate change in their business risk management processes. This study quantifies the impact of CCDP on auditor risk assessments via audit fees.
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This paper aims to investigate the impact of sustainable board governance, based on (1) sustainability board committees, (2) critical mass of female board members and (3…
Abstract
Purpose
This paper aims to investigate the impact of sustainable board governance, based on (1) sustainability board committees, (2) critical mass of female board members and (3) sustainability-related executive compensation, on sustainable supply chain reporting (SSCR).
Design/methodology/approach
Based on stakeholder and critical mass theories, a sample of 1,577 firm-year observations for firms listed at the EuroSTOXX600 for the period 2017–2021 is used. Sustainable board governance and SSCR proxies are collected from the Refinitiv database. Correlation and logit regression analyses are conducted to measure the impact of sustainable board governance on SSCR.
Findings
Sustainable board governance significantly improves SSCR. The findings are robust to various robustness checks, based on the modification of dependent and independent variables.
Research limitations/implications
Due to massive regulations on sustainability reporting, finance and corporate governance, firms listed on the EuroSTOXX 600 are focused in this analysis. The European capital market represents a unique setting for archival research.
Practical implications
European standard setters should connect the relationship between sustainable board governance and SSCR in future regulations, for example, due to the recent corporate sustainability reporting directive (CSRD) and corporate sustainability due diligence directive (CSDDD).
Originality/value
To the best of the author’s knowledge, this paper provides the first analysis on the impact of sustainable board governance on SSCR.
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Amin Sarlak, Mehdi Khodakarami, Reza Hesarzadeh, Jamal A. Nazari and Fatemeh Taghimolla
Climate change has led to a rise in the frequency, intensity and scope of droughts, posing significant implications for businesses. This study examines the impact of local…
Abstract
Purpose
Climate change has led to a rise in the frequency, intensity and scope of droughts, posing significant implications for businesses. This study examines the impact of local community drought levels on audit pricing. Additionally, it explores the moderating effects of high-tech industries, auditor busyness and the level of local community concern regarding the drought crisis.
Design/methodology/approach
This study employs a mixed-methods approach to rigorously test the research hypotheses. The quantitative phase of the study utilizes a sample of 1,278 firm-year observations from Iran’s capital market. For the analysis of the quantitative data, ordinary least squares regression with clustered robust standard errors is used. Additionally, this research supplements its quantitative findings with qualitative evidence obtained through semi-structured interviews with 19 Iranian audit partners.
Findings
The results suggest that firms operating in provinces facing severe droughts experience notably higher audit fees. Furthermore, the positive relationship between drought and audit fees is weakened when auditors are busy, local community concern regarding the drought crisis is high or the firm operates within high-tech industries. These findings are supported by a range of robustness checks and qualitative evidence gathered from the field.
Originality/value
This research contributes to the growing literature on climate change by examining the influence of local community drought levels on audit pricing within an Iranian context. Additionally, our study sheds light on how high-tech industries, auditor workload and the level of local community concern regarding the drought crisis moderate the relationship between drought and audit fees. Importantly, our study pioneers in providing mixed-methods evidence of the association between drought severity and audit fees.
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Sarwenda Biduri and Bambang Tjahjadi
The purpose of this study was to determine the determinants of financial statement fraud: the perspective of pentagon fraud theory.
Abstract
Purpose
The purpose of this study was to determine the determinants of financial statement fraud: the perspective of pentagon fraud theory.
Design/methodology/approach
This study used quantitative methods with an explanatory research design by applying secondary data on Islamic banking companies listed on the Indonesia Stock Exchange (IDX).
Findings
External pressure affects financial statement fraud, ineffective monitoring affects financial statement fraud, external auditor quality affects financial statement fraud, change in auditor affects financial statement fraud, frequent number of CEO’s picture affects financial statement fraud, external pressure affects firm size, ineffective monitoring affects firm size, external auditor quality affects firm size, change in auditor affects firm size, frequent number of CEO’s picture affects firm size, firm size affects financial statement fraud, firm size mediates the relationship between external pressure on financial statement fraud, firm size mediates the relationship between ineffective monitoring on financial statement fraud, firm size mediates the relationship between external auditor quality and financial statement fraud, firm size mediates the relationship between change in auditor and financial statement fraud, firm size mediates the relationship between frequent number of CEO’s picture and financial statement fraud.
Research limitations/implications
The limitations of this research were found during the research process and can be used as input for further research and related parties in conducting the research to obtain better research results. The limitations of this study are as follows: this study only focused on Islamic banking, so it cannot be generalized to other sectors. Besides, this study only tested five independent variables, one dependent variable and one mediating variable.
Practical implications
For external auditors, financial statement fraud by management might be caused by many factors and is a social as well as an economic problem that must be addressed immediately. Therefore, in carrying out the duties and roles as an external auditor, they must have an attitude of independence (not taking sides) in the mental attitude that must be maintained by the auditor related to the assignment. Auditors must have sufficient technical expertise and training as auditors. In carrying out the audit, the auditor should use their professional skills in responding carefully and thoroughly. Moreover, in carrying out audit work, the auditor must have a plan, must know adequate internal control and obtain sufficiently competent audit evidence.
Originality/value
To the best of the authors’ knowledge, very few studies in Indonesia have applied the Beneish model. There is only one study that implemented the Beneish model, and the study examined only a few companies listed on the IDX. The findings of the present study have important implications not only for banks but also for users of financial statement accounts in Indonesia, especially for investors, auditors, regulators, taxation and other state authorities.
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Swarup Mukherjee, Anupam De and Supriyo Roy
Identifying and prioritizing supply chain risk is significant from any product’s quality and reliability perspective. Under an input-process-output workflow, conventional risk…
Abstract
Purpose
Identifying and prioritizing supply chain risk is significant from any product’s quality and reliability perspective. Under an input-process-output workflow, conventional risk prioritization uses a risk priority number (RPN) aligned to the risk analysis. Imprecise information coupled with a lack of dealing with hesitancy margins enlarges the scope, leading to improper assessment of risks. This significantly affects monitoring quality and performance. Against the backdrop, a methodology that identifies and prioritizes the operational supply chain risk factors signifies better risk assessment.
Design/methodology/approach
The study proposes a multi-criteria model for risk prioritization involving multiple decision-makers (DMs). The methodology offers a robust, hybrid system based on the Intuitionistic Fuzzy (IF) Set merged with the “Technique for Order Performance by Similarity to Ideal Solution.” The nature of the model is robust. The same is shown by applying fuzzy concepts under multi-criteria decision-making (MCDM) to prioritize the identified business risks for better assessment.
Findings
The proposed IF Technique for Order Preference by Similarity to the Ideal Solution (TOPSIS) for risk prioritization model can improve the decisions within organizations that make up the chains, thus guaranteeing a “better quality in risk management.” Establishing an efficient representation of uncertain information related to traditional failure mode and effects analysis (FMEA) treatment involving multiple DMs means identifying potential risks in advance and providing better supply chain control.
Research limitations/implications
In a company’s supply chain, blockchain allows data storage and transparent transmission of flows with traceability, privacy, security and transparency (Roy et al., 2022). They asserted that blockchain technology has great potential for traceability. Since risk assessment in supply chain operations can be treated as a traceability problem, further research is needed to use blockchain technologies. Lastly, issues like risk will be better assessed if predicted well; further research demands the suitability of applying predictive analysis on risk.
Practical implications
The study proposes a hybrid framework based on the generic risk assessment and MCDM methodologies under a fuzzy environment system. By this, the authors try to address the supply chain risk assessment and mitigation framework better than the conventional one. To the best of their knowledge, no study is found in existing literature attempting to explore the efficacy of the proposed hybrid approach over the traditional RPN system in prime sectors like steel (with production planning data). The validation experiment indicates the effectiveness of the results obtained from the proposed IF TOPSIS Approach to Risk Prioritization methodology is more practical and resembles the actual scenario compared to those obtained using the traditional RPN system (Kim et al., 2018; Kumar et al., 2018).
Originality/value
This study provides mathematical models to simulate the supply chain risk assessment, thus helping the manufacturer rank the risk level. In the end, the authors apply this model in a big-sized organization to validate its accuracy. The authors validate the proposed approach to an integrated steel plant impacting the production planning process. The model’s outcome substantially adds value to the current risk assessment and prioritization, significantly affecting better risk management quality.
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Premaratne Samaranayake, Michael W. McLean and Samanthi Kumari Weerabahu
The application of lean and quality improvement methods is very common in process improvement projects at organisational levels. The purpose of this research is to assess the…
Abstract
Purpose
The application of lean and quality improvement methods is very common in process improvement projects at organisational levels. The purpose of this research is to assess the adoption of Lean Six Sigma™ approaches for addressing a complex process-related issue in the coal industry.
Design/methodology/approach
The sticky coal problem was investigated from the perspective of process-related issues. Issues were addressed using a blended Lean value stream of supply chain interfaces and waste minimisation through the Six Sigma™ DMAIC problem-solving approach, taking into consideration cross-organisational processes.
Findings
It was found that the tendency to “solve the problem” at the receiving location without communication to the upstream was, and is still, a common practice that led to the main problem of downstream issues. The application of DMAIC Six Sigma™ helped to address the broader problem. The overall operations were improved significantly, showing the reduction of sticky coal/wagon hang-up in the downstream coal handling terminal.
Research limitations/implications
The Lean Six Sigma approaches were adopted using DMAIC across cross-organisational supply chain processes. However, blending Lean and Six Sigma methods needs to be empirically tested across other sectors.
Practical implications
The proposed methodology, using a framework of Lean Six Sigma approaches, could be used to guide practitioners in addressing similar complex and recurring issues in the manufacturing sector.
Originality/value
This research introduces a novel approach to process analysis, selection and contextualised improvement using a combination of Lean Six Sigma™ tools, techniques and methodologies sustained within a supply chain with certified ISO 9001 quality management systems.
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Aamir Rashid, Rizwana Rasheed and Abdul Hafaz Ngah
Green practices are essential for sustainability. However, it is challenging due to the socioeconomic and environmental concerns. Similarly, after the induced SDG-12 and SDG-13 by…
Abstract
Purpose
Green practices are essential for sustainability. However, it is challenging due to the socioeconomic and environmental concerns. Similarly, after the induced SDG-12 and SDG-13 by United Nations, the pressure groups forced manufacturers to consider sustainability. Therefore, this research aims to examine the sustainability through multifaceted green functions in manufacturing is examined.
Design/methodology/approach
Data were collected from 293 supply chain professionals of manufacturers from a developing economy. Hypotheses were tested through a quantitative method using partial least squares-structural equation modeling with the help of SmartPLS version 4 to validate the measurement model.
Findings
The findings revealed that all six direct hypotheses were supported. However, out of four hypotheses of mediation, one was not supported. Besides, a sequential mediation of green supply chain environmental cooperation and green human resource management was supported. The findings illustrated that green supply chain practices positively influence all used variables.
Research limitations/implications
This research provides practical insight to practitioners to implement green practices in their supply chain networks for social, economic and environmental sustainability and compliance with SDG-12 and SDG-13. The sustainability was validated in a higher-order construct (HOC) (formative), including sequential mediation in the model with the support of resource dependency theory. Therefore, this study adds substantial literature to the existing body of knowledge.
Originality/value
This research provides an interdisciplinary framework by adding knowledge to the Resource Dependency Theory to address Sustainable Development Goals-12 (SDGs) and SDG-13. Likewise, this research provides an extension towards the body of knowledge on the issue, which can be used in future research and critical examinations for cleaner and sustainable production. So far, in Pakistan, no research has looked at the function of these integrated variables in the manufacturing industry with a diligent focus on sustainability as it was validated in a higher-order construct (formative) with one sequential mediation, which makes this research unique.
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Linh Thi Phuong Nguyen, Natdanai Aleenajitpong and Sakun Boon-itt
This paper aims to provide a comprehensive knowledge structure for environmental accounting (EA) research by identifying research hotspots and frontiers and suggesting future…
Abstract
Purpose
This paper aims to provide a comprehensive knowledge structure for environmental accounting (EA) research by identifying research hotspots and frontiers and suggesting future trends for scholarly investigation.
Design/methodology/approach
Using the bibliometric method, the paper analyzed 321 academic articles and reviews in international journals from the Scopus database. Science mapping, including strategic diagrams, network analysis and thematic maps, was used to analyze the evolution of topics and to recommend future research trends.
Findings
EA research is an emerging trend. This study presents the landscape of EA research by constructing the “synthesis house of knowledge” in EA. Significant EA research areas were identified and future research trends were suggested based on the results.
Practical implications
This paper provides insights into the current state of EA research and identifies potential future research trends that can help scholars and experts develop and stimulate further advancement of the research in this field.
Social implications
Results may motivate policymakers and government agencies to formulate regulations to enforce appropriate corporate environmental strategies to better manage environmental costs and reduce community environmental impact.
Originality/value
The study provides an intellectually structured literature review of the EA research field; identifies the main themes through the innovative use of network analysis, strategic diagrams and thematic maps; highlights research gaps; and offers potential research questions and suggestions for future research. The novelty of this paper lies in the “synthesis house of knowledge” in EA and the research gaps and potential and specific research questions constructed from the findings.
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Ahsan Nawaz and Francis Lanme Guribie
Social procurement (SP) is a complicated and risky innovation, the adoption of which needs to be accompanied by complementary process and organizational change. To date, however…
Abstract
Purpose
Social procurement (SP) is a complicated and risky innovation, the adoption of which needs to be accompanied by complementary process and organizational change. To date, however, there has been little empirical evidence explaining whether and how different sorts of external pressures affect the level of SP adoption in the construction sector. Drawing on institutional theory, this study aims to analyze how three types of isomorphic pressures (i.e. coercive, mimetic and normative pressures) influence the adoption of SP in the construction sector.
Design/methodology/approach
The impacts of these pressures are empirically tested with survey data collected from 134 construction firms in the Chinese construction industry.
Findings
The findings show that both coercive and mimetic pressures have a considerable impact on the adoption of SP. However, there is little evidence in this study that normative demands had a major impact on SP.
Practical implications
This research is a useful instrument for promoting a favorable social attitude regarding construction procurement. Through socioeconomic regeneration and development, procurement can be considered as a significant route for social transformation, economic development and poverty reduction.
Originality/value
This study addresses the paucity of research into SP in the construction industry by establishing the institutional drivers to procuring services and products from a social enterprise perspective. Findings from this study extend the frontiers of existing knowledge on SP in the construction industry.
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