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1 – 2 of 2Martin Kelly and Patricia Larres
Following recent high-profile audit failures, concern has been expressed that auditors are not demonstrating sufficient skepticism when exercising professional judgment. In…
Abstract
Purpose
Following recent high-profile audit failures, concern has been expressed that auditors are not demonstrating sufficient skepticism when exercising professional judgment. In particular, client assumptions and estimations relating to hypothetical valuations in financial reporting are not being challenged. This paper seeks to address the issue by advancing a decision-making framework aimed at guiding auditors beyond regulatory reductionist thinking towards an enhanced understanding of the cognitive processes which shape professional judgment in forming a reliable audit opinion.
Design/methodology/approach
Drawing on the normative philosophical and theological teachings of Bernard Lonergan, the authors' decision-making framework embodies reflective thinking and the data of consciousness to highlight the central role played by enquiry in the dynamics of understanding, judgment and decision-making. Such enquiry elicits challenge of the management bias inherent in hypothetical valuations.
Findings
Auditing through a Lonerganian lens allows auditors to reflect on their approach to objective decision-making by offering a set of cognitive tools to enhance the enquiry essential for nurturing professional skepticism.
Originality/value
This paper contributes to the literature by developing the somewhat neglected discourse on the cognitive processes essential for professional skepticism and audit judgment. The authors demonstrate how Lonerganian self-appropriation intensifies an awareness of the recursive cognitive activities pertinent to objective judgment and decision-making. This awakened consciousness has the potential not only to change how auditors question evidence to make informed judgments and decisions, but also to normalize the practice of challenge.
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Sharfuddin Ahmed Khan, Wafaa Laalaoui, Fatma Hokal, Mariam Tareq and Laila Ahmad
Reverse logistics (RL) has become integral in modern supply chains, with many companies investing in circular economy (CE), a recuperative and effective industrial economy. The…
Abstract
Purpose
Reverse logistics (RL) has become integral in modern supply chains, with many companies investing in circular economy (CE), a recuperative and effective industrial economy. The traditional linear model triggered many negative environmental consequences such as climate change, ocean pollution, loss of biodiversity and land degradation. The development of RL strategies that support the transition between RL to CE is crucial. The purpose of this paper is to connect RL with CE in the context of Industry 4.0 and develop a hierarchal structure to explore the relationship between RL and CE critical success factors in the context of Industry 4.0.
Design/methodology/approach
This study used both qualitative and quantitative approach. Literature review in collaboration with the Delphi method is used to identify and validate critical success factors. Then, the ISM-based model and MICMAC method were used to determine the relationship between CE and RL success factors and its driving and dependence power.
Findings
This study result shows that waste reduction, skilled employees and expert's involvement and top management commitment and support will provide guidelines and paths for implementing CE and RL, leading to the competitiveness of a firm.
Practical implications
The findings provide managerial insight, particularly useful to third-party logistics companies' managers who are looking to implement RL and CE, to help prioritize where to invest company resources to generate prime difference. Furthermore, this study also identified Industry 4.0 technologies, which would tackle top identified critical success factors within the hierarchical model such as block chain and digital platforms.
Originality/value
This paper contributes to the literature by exploring the connection between RL and CE in the context of Industry 4.0 that determines the critical success factors enabling sustainable inter-firm collaboration.
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