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To provide evidence on the establishment of the internal audit function in the higher education institutions in Malaysia and also to obtain the perceptions of the management of the higher education institutions towards the role and scope of the internal audit.

Sample consisted of 17 public universities and 49 private universities in Malaysia and variables used by Gordon and Fischer were adopted for this study.

The findings revealed that a substantial number of private institutions of higher education do not have an internal audit function. The study also indicates that the management of both types of institutions have similar perceptions on the role of internal auditors and the important audit areas as there are no significant differences between public and private institutions of higher education.

The main limitation of this study is that it only examines whether the scope of internal audit covers the areas mentioned by treasury circular or the IIA Guideline. It ignored the extent to which the higher education institutions comply with both guidelines. It is, therefore, suggested that future research could consider the degree of compliance to the above guidelines. The difference in the role of internal auditing between the education sector and other industries represents an interesting area for further research. Also, since this study only focuses on the perceptions of the management and the internal auditor themselves, the perception of other parties such as regulators and the audit committee on the role of internal audit in institutions of higher education will be an interesting area to explore for future research.

The failure to establish an internal audit function in the private universities calls for government intervention to ensure the existence of an internal audit function in the private sector higher education institutions.

The findings of this paper will be important in further refining the scope of the internal audit function in the higher educations institutions in Malaysia, especially to policymakers concerned with regulations governing the internal audit function.

Changes in structure and conceptual underpinnings of ISO 9001 mean that quality management system (QMS) auditors require a wide knowledge base and skill set to effectively evaluate contemporary QMS and add value to the process. Hence, this study presents an open curriculum framework of the knowledge, skills and attributes for quality auditor education.

This study describes the first two phases of a three-phase study examining the educational requirements for external quality auditors (EQAs). Phase 1 involved a review of relevant international literature on auditor competence and education; Phase 2 involved the collection of qualitative data from a panel of experts, combined with the initial round of a Delphi study. A thematic analysis was used to analyze the findings from the questionnaire.

The findings of this study suggests there is a need to improve EQAs education, as most experts reported the quality of audit to be variable, inconsistent, poor and diminishing in value. The most important improvements to auditor education are to update and improve the auditors' knowledge on the requirements of the ISO 9001 standard and technology in business and skills such as report writing, communication, IT understanding and analytical ability. Some of the attributes reported as being desirable to instill in EQAs include the following: objectivity, integrity, ethics and professionalism; being observant, perceptive, articulate and confident; having good judgment; flexibility, adaptivity and diplomacy, fairness and open-mindedness.

This study highlights the need for wider EQA education based on the gap identified in its performance. The resulting framework can be adopted by accreditation and certification bodies to evaluate and improve their auditors' audit performance.

Current emphasis in enhancing the role of internal auditors and broadening knowledge and skills of future internal auditors have given increased impetus for the requirement of 150‐hour accounting education for future Certified Internal Auditors (CIAs). Examines why internal auditors, especially CIAs, need the additional education requirement beyond the Bachelor′s degree and how to implement the 150‐hour education programme for internal auditors.

The purpose of this paper is to investigate whether the existence of a professional oversight body and certain country‐specific education regulations in auditing are associated with a country's perceived level of corruption.

Drawing on data from the International Federation of Accountants (IFAC) database, the authors used the Mann‐Whitney U analysis technique to test the difference between countries' perceived level of corruption based on whether they have or have not developed professional oversight bodies and licensing regulations.

Results suggest that countries that have established an audit profession oversight body are, indeed, perceived to be less corrupt. Similarly, countries that require practical experience, academic study, and a licensing examination in order to practice auditing are perceived to be less corrupt. On the other hand, the analysis shows that requiring auditors to fulfil continuing education requirements is not significantly related to a perception of lower levels of corruption.

The paper provides important insights for policy makers, business leaders, education and the audit profession as a whole.

This paper provides some of the first empirical support for the relationship between corruption and the use of oversight bodies and licensing regulations in professional auditing at a country level.

Following the high profile collapses of Enron and WorldCom, and the demise of Andersen, human capital (HC) has become a key driver of auditor quality. The purpose of this study is to investigate if there is a positive association between HC and auditor quality in public accounting firms and if the extent of association varies between accounting firms.

Multiple regression and logistic modeling are applied to examine the association between auditor quality and HC. The sample consists of 4,865 firm‐year observations over the period from 1989 to 2004.

The main findings indicate that higher investments in HC correspond to a higher level of auditor quality. Furthermore, the power of HC on auditor quality has a significant difference between public and non‐public audit market firms.

A number of theoretical and measurement limitations are acknowledged that could further increase the statistical power of the tests.

The findings should be of interest to regulators, auditors, audit clients, and academics. The findings also suggest that HC has an impact on overall auditor quality. The audit firms need more well‐educated and well‐trained professionals with the experience to keep pace with the changing nature of the market and to perform audit tasks.

The findings fill a gap in the literature regarding auditor quality and HC from the perspective of public accounting firms.

The purpose of this paper is to examine how New Zealand financial auditors could be motivated to improve current practices in regards to auditing the effects of environmental matters in financial reports.

This is a qualitative study. The views of 27 New Zealand private and public sector auditors were solicited via semi‐structured interviews. Concepts from new institutional theory, and in particular institutional isomorphism, are used to interpret the research findings.

The interview evidence indicates that a combination of normative, coercive and mimetic forces would be necessary to advance current practices in auditing environmental matters. A crucial driver of change would be a mindset shift within the profession about the importance of environmental accountability, reporting and auditing – i.e. increased normative pressures for change. Coercive forces of negative media publicity, the “fear factor” and government intervention can serve to reinforce the audit profession's normative obligations. Since public sector auditors have already developed effective audit practices around environmental matters, emulating their approach within the private sector would drive improvements in practice.

By identifying the potential drivers for improving auditors' practices, this paper can inform the discussions and strategies of professional bodies, regulators and government on improving the audit of environmental matters in financial reports.

Few prior studies have solicited financial auditors' views on the factors they perceive as motivating change in their professional practice, and none have done so in regard to the important and emerging area of environmental matters. This New Zealand study offers a timely contribution, as well as geographical diversity, to the international literature on audit theory and practice.

This paper aims to explore managers' and auditors' perceptions of intellectual capital (IC) measurement and reporting in Egyptian companies.

The paper draws on a questionnaire survey sent to managers and external auditors who were asked to provide their opinion about IC measurement and reporting for companies listed on the Egyptian Stock Exchange.

The paper finds significant differences between respondents' rates on IC indicators. These differences are due to different industry sectors involved in our sample. Further, it finds that Egyptian listed firms neither measure nor report IC indicators in their annual reports. In addition, it finds that auditors' responsibilities on IC reporting are ambiguous. Finally, the paper finds that work experience is the main determinant of managers' perceptions of IC indicators, while professional education is the main determinant of external auditors' perceptions of IC indicators.

Prior research on IC used the content analysis approach to measure levels of IC disclosure in annual reports. This paper adds to the existing literature by using the results of a survey questionnaire distributed to managers working in (and auditors specialised in) Egyptian companies to explore their perceptions on IC measurement and reporting. Since prior research has focused on developed economies, we strongly believe that this paper contributes to the existing literature, as we are the first to examine this issue in Egypt as an example of a developing economy.

The purpose of this paper is to determine if there is a level of agreement among accounting academics, auditors, and forensic accountants that the current environmental framework created by regulatory and standard setting bodies appears to require a merger of common ground between forensic accounting and auditing.

A survey in the USA is conducted for a random sample of accounting academics, forensic accounting practitioners, and auditors questioning if the addition of forensic accounting proficiency should be part of an auditor's skill set to increase the probability of detecting fraud.

The results indicate that forensic accounting has a place in the audit process and that auditors may need to add some of these skills as the market for audits have changed.

The limitation of the current paper which is inherent to survey research is non‐response bias. The only way to evaluate this is to test late responses and compare them to earlier results. There are no significant differences. Future research in this area should progress to experimental designs using foundational forensic procedures in a simulated audit setting to ascertain the success and the proper implementation of these skills in finding financial statement fraud.

This paper will increase auditor awareness of the importance of the acquisition of foundational forensic accounting skills that will enhance the likelihood of fraud detection.

Professions evolve by way of regulatory, political, and social responses. Although there are some distinct differences between forensic accountants and auditors in the USA, there is enough common ground to answer the call for auditors to be more mindful of finding fraud. This paper intends to draw attention to the fact that foundational forensic accounting skills may represent a paradigm shift for professional skills in the accounting markets.

The purpose of this paper is to examine the direct linkage between professional scepticism and auditor independence.

The study reviews the extant literature on professional scepticism, auditor independence, conflict of interest and unconscious bias.

Auditor independence is a fundamental antecedent to professional scepticism. However, auditor independence is impossible due to the auditor–client structure and conscious and unconscious personal bias. The threats to auditor independence are powerful incentives that reduce professional scepticism, making it difficult to exercise professional scepticism while making professional judgement.

An understanding of the direct link between professional scepticism and auditor independence is necessary to appreciate the context and meaning of professional scepticism in relation to the greater body of literature and ongoing concerns of audit regulators. This paper, which conceptualises the linkage between professional scepticism and auditor independence, provides a platform for future research to be conducted to examine the validity of the discussions and how a discourse in a moral framework embedded within accounting education may assist in improving auditor independence and professional scepticism.

It is insufficient for audit regulators to assess professional scepticism by audit outputs. Threats to independence should be brought into the assessment. To ensure auditor independence is not compromised, auditors should be made aware of the ethical dimensions of their decisions and reminded constantly to monitor virtue ethics behaviours.

This paper brings into mainstream accounting and auditing literature and research a psychological perspective of auditor independence in the discussion of professional scepticism that is seldom examined.

The purpose of this study is to investigate Egyptian auditors’ ethical reasoning, to understand whether auditors’ ethical reasoning is influenced by audit firm size and/or auditor’s position.

This paper draws on 178 questionnaires that include six different ethical scenarios. This paper also uses the accounting ethical dilemma instrument that is developed by Thorne (2000) to measure the ethical reasoning of Egyptian auditors.

The findings are threefold. First, this study finds that the general level of deliberative ethical reasoning of auditors working in the Central Auditing Organization (CAO) and small firms are categorized in the post-conventional level, while auditors working in big and medium firms are categorized in conventional level. Second, the result suggests that there is a negative relationship between ethical reasoning and audit firm size in Egypt. Finally, the results show that ethical reasoning levels decrease when the position of auditors increase except for auditors working in CAO.

This study adds to the scarce literature in developing countries that measure auditors’ ethical reasoning. The findings suggest that auditors’ ethical reasoning depends on auditor’s firm size and the position the auditor holds within the firm. These findings will aid policymakers and regulators, especially in developing countries, to avoid any potential risk regarding professional misconduct and in evaluating the adequacy of the current code of ethics.