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Professional accounting associations in various countries and governmental and other quasi‐official bodies have played an important role not only in the evolution of internal control reporting on a global scale, but also in educating management, investors, financial institutions, accountants, auditors, and other interested parties highlighting the pervasiveness of the effects of a sound internal control structure in corporate reporting as well as other aspects of an organization′s success. These associations include the Institute of Internal Auditors (IIA), the American Institute of Certified Public Accountants (AICPA), the General Accounting Office (GAO), the Securities and Exchange Commission (SEC), the Cadbury Committee, the Institute of Chartered Accountants of England and Wales (ICAEW), the Scottish Institute of Chartered Accountants (SICA), the Canadian Institute of Chartered Accountants (CICA), and others. Business failures, management fraud, corporate misconduct, international bribery, and notorious business scandals in all sectors of business have prompted the US government to take drastic action on internal control reporting to safeguard public interest. Several professional and government committees were formed to study this precarious situation: the Treadway Commission, the Committee of Sponsoring Organizations (COSO) of the Treadway Commission, the Packard Commission, the Cohen Commission, the Adams Commission in Canada, the Cadbury Committee in the UK, and others. The principal motivation for the changing dynamics has been growing public pressure for greater corporate accountability. The government′s pressure on the accounting profession and management of public corporations has been pivotal in spearheading internal control reporting. Examines the role of professional associations, governmental agencies, and others in promulgating standards for internal control reporting, and the impact of legislation on this aspect of internal auditing in the USA and worldwide.

This paper examines the role of professional associations, governmental agencies, and international accounting and auditing bodies in promulgating standards to deter and detect fraud, domestically and abroad. Specifically, it focuses on the role played by the US Securities and Exchange Commission (SEC), the American Institute of Certified Public Accountants (AICPA), the Institute of Internal Auditors (IIA), the Institute of Management Accountants (IMA), the Association of Certified Fraud Examiners (ACFE), the US Government Accounting Office (GAO), and other national and foreign professional associations, in promulgating auditing standards and procedures to prevent fraud in financial statements and other white‐collar crimes. It also examines several fraud cases and the impact of management and employee fraud on the various business sectors such as insurance, banking, health care, and manufacturing, as well as the role of management, the boards of directors, the audit committees, auditors, and fraud examiners and their liability in the fraud prevention and investigation.

Whistleblowers have been credited for uncovering financial scandals in companies globally, including Enron, Olympus Corporation, and WorldCom. Despite increasing support and incentives for whistleblowing, there generally remains reluctance to blow the whistle. Thus, the purpose of this study is to review: (1) the determinants of internal and external whistleblowing on accounting-related misconduct, (2) U.S. whistleblowing legislation on accounting-related misconduct and related research, and (3) the effects of whistleblowing on firms and whistleblowers. Within each area, suggestions for future research are offered.

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 analyse the extent to which the perceived usefulness of financial information for internal decision making is affected by the internal control to which that information is subjected.

The research is positivist and quantitative, based on a cross-sectional analysis developed in the local government context. Data were collected from a survey to decision makers (politicians and chief officials) in charge of the financial area in all Portuguese municipalities. The response rate was approximately 49 per cent, assuring representativeness.

Regarding the perceived usefulness of financial and budgetary reporting for internal decision making, the results in the paper show that municipalities’ internal users’ attitudes towards using accrual-based financial reporting for decision making is changing. Additionally, internal decision makers consider financial and budgetary information as very useful for decision making, and the different types of internal control applicable to that information as very important. The results also clearly point to the existence of a significant and positive relationship between the internal control (including internal auditing) to which financial and budgetary information is subject, and its perceived usefulness for municipal decision making.

The main limitations of this study are related to the way in which information was collected in order to obtain empirical evidence. The questionnaire, sent by e-mail, despite reaching a wide-range and dispersed population, cannot guarantee the truthfulness and integrity of the responses. Findings might have been affected by the fact that respondents may have been sympathetic to the reforms brought by the Official Local Government Accounting Plan (POCAL). Certainly, politicians linked to the political party that promoted those reforms would be predisposed in this way. Another limitation might concern the fact that new laws and regulations passed after POCAL, might have somehow affected the answers regarding the perceived usefulness of budgetary and financial information for internal decision making, as well as the importance of the internal control to which that information is subject.

The results of this study have important repercussions for the implementation of internal control systems at local government level. Particularly, they highlight the need to develop or improve internal control procedures to ensure budgetary and financial information reliability, which in turn determines its usefulness for decision-making purposes.

This research makes a contribution to the (scarce) literature on the relationship between internal control and the perceived usefulness of financial and budgetary information for decision making, particularly in the local government setting. It adds with further empirical evidence concerning the relationship between these two issues, helping to reinforce previous embryonic research in this field. As to policy making, this research also contributes by calling attention for the need to define the types of internal control financial information must be subject, a critical issue while assuring the usefulness of that information for decision making. This is particular important in current contexts of countries moving towards IPSAS-based financial reporting systems.

This article explores the influence of duality in institutional logics on internal accounting, with a focus on a Polish public university. More particularly, we answer the research question: how does illegitimacy risk arising from the divergent pressures of the institutional environment impact management accountings in this institution?

This paper seeks to uncover intricacies of notions of internal legitimacy façade, decoupling and counter-coupling in practice. It explores details of organizational responses involving management accounting aimed at reducing illegitimacy risk. Achieving good organizational access, the authors adopt a qualitative case study approach involving contextual appreciation/document analysis/participant observation/discussion with key actors: facilitating building upon theoretical argumentation through finding things out from the field.

The authors uncover and discuss organizational solutions and legitimizing manoeuvres applied, identifying four adaptation tactics in the struggle to support legitimacy that they term ‘ceremonial calculations’, ‘legitimacy labelling’, ‘blackboxing’ and ‘shadow management accounting’. These can be seen in relation to decoupling and counter-coupling. Ceremonial calculations supported the internal façade. Shadow management accounting supported pro-effectiveness. Legitimacy labelling and blackboxing helped bind these two organizational layers, further supporting legitimacy. In interaction the four tactics engendered what can be seen as a ‘counter-coupling’ of management accounting. The authors clarify impacts for management accounting.

The usual limitations of case research apply for generalizability. Theorizing of management accounting in relation to contradictory logics is advanced.

The article illuminates how management accounting can be understood vis-à-vis contradictory logics.

Elaboration of the tactics and their interaction is a theoretical and empirical contribution. Focus on a Polish university constitutes an empirical contribution.

The Foreign Corrupt Practices Act (FCPA) of 1977 and its amendment – the Trade and Competitive Act of 1988 – are unique not only in the history of the accounting and auditing profession, but also in international law. The Acts raised awareness of the need for efficient and adequate internal control systems to prevent illegal acts such as the bribery of foreign officials, political parties and governments to secure or maintain contracts overseas. Its uniqueness is also due to the fact that the USA is the first country to pioneer such a legislation that impacted foreign trade, international law and codes of ethics. The research traces the history of the FCPA before and after its enactment, the role played by the various branches of the United States Government – Congress, Department of Justice, Securities Exchange commission (SEC), Central Intelligence Agency (CIA) and the Internal Revenue Service (IRS); the contributions made by professional associations such as the American Institute of Certified Public Accountants (AICFA), the Institute of Internal Auditors (IIA), the American Bar Association (ABA); and, finally, the role played by various international organizations such as the United Nations (UN), the Organization for Economic Cooperation and Development (OECD), the World Trade Organization (WTO) and the International Federation of Accountants (IFAC). A cultural, ethical and legalistic background will give a better understanding of the FCPA as wll as the rationale for its controversy.

States that change is occurring rapidly in accounting education. Forces are converging to promote more educational breadth, increased emphasis on communication skills, higher quality teaching, innovative pedagogy, and more practical research. Suggests that the major developments unfolding in accounting education will, no doubt, have many effects on internal auditing. Reviews some of the major forces buffeting accounting education, illustrates how these forces are affecting curricula and faculty, outlines some of the changes that are being made and anticipated, and projects how these changes are likely to affect internal auditing. Shows that, in general, the changes should be beneficial to internal auditing but that there are some dangers inherent in the possible extent of change and some doubts as to the feasibility of early accomplishments of some of the called for reforms.

The purpose of this paper aims to investigate whether the source of audit committee accounting expertise influences the internal audit function (IAF) effectiveness in the Tunisian setting.

In the analysis, the authors conduct a survey of chief internal auditors from Tunisian listed companies. Then, a multivariate regression analysis is performed in order to analyze the relationship between audit committee financial expertise and IAF effectiveness.

The findings of the present study show that audit committee accounting financial expertise is most likely to be positively associated with the implementation of internal audit report recommendations. The authors also find that only financial expertise gained from accounting education and experience (e.g. an audit committee member with experience as a certified public accountant, auditor, chief financial officer or chief accounting officer) is associated with a stronger implementation of IAF recommendations, but not financial expertise gained from work experience in finance positions.

These results may have implications for regulatory bodies. They can provide a better understanding of the role of the audit committee expertise in monitoring internal audit processes. The major contribution of this study is that the audit committee's oversight role is strengthened if the committee members have accounting and auditing expertise.

The study extends prior literature by providing evidence that the source of audit committee accounting financial expertise enhances internal audit effectiveness beyond the outcomes it has on financial reporting quality. The study also contributes to the ongoing debate in the corporate governance literature concerning the definition of the financial expertise of audit committee members.

The purpose of this study is to investigate the impact of internal control weaknesses on accounting conservatism in Chinese listed firms. It also investigates the relationship between the demand for external audit and accounting conservatism, and whether additional assurance of internal control reports (ICRs) can mitigate the negative impact of ICWs on accounting conservatism.

An empirical research approach is taken through the use of ordinary least squares (OLS) models and hand-collected internal control weakness data from ICRs released by Chinese listed firms.

The results of this paper show that the existence of ICWs has a negative effect on accounting conservatism in China. Further, the results demonstrate that both accounting-related and non-accounting-related ICWs affect accounting conservatism. The authors also find that there is a complementary relationship between accounting conservatism and the demand for additional assurance of ICRs, and additional assurance of ICRs can mitigate the negative impact of ICWs on accounting conservatism.

This study provides timely evidence to Chinese regulators of the possible economic consequences of the official implementation of internal control standard in China from 2012. The findings of this paper can also benefit regulators around the world and, in particular, the regulators in emerging markets that are considering implement regulations similar to the US SOX.

The paper demonstrates that a wider scope of ICWs, including non-accounting-related ICWs, also has a significant impact on accounting conservatism. Therefore, this research provides a more general evidence on the relationship between internal control quality and accounting conservatism.