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The purpose of this paper is to re-test the determinant factors of the quality of financial statements and performance of the government by adding contextual factors, such as personal factor, system/administrative factor and political factor, that may affect the quality of financial statement information and performance of the government. Personal factor is proxied to the competencies that affect the quality of financial statements and performance. Social administrative factor is proxied on the regulations and presentation of quality financial statements.

The analysis unit in this study was conducted at the organizational level. The research object was in South Sulawesi Province. This was a descriptive and verificative research with survey technique. Based on the objectives of the research, this is an explanatory research. The research method used was explanatory survey with quantitative approach. The population of this research was proxied to the Regional Unit Organization (Organisasi Perangkat Desa) which compiled the financial statements in South Sulawesi Provincial Government consisted of 803 units of Local Government Agencies (Satuan Kerja Perangkat Daerah). The purposive sampling technique was chosen under the following criteria: the regional government whose financial statement has been audited by Badan Pemeriksa Keuangan; the regional government whose financial accountability report has been evaluated by Indonesia’s Agency for Financial and Development Supervision (Badan Pengawasan Keuangan dan Pembangunan). In line with the criteria mentioned above, the minimum samples required for 26 observations/indicators are 5×26=130 respondents. The sample size met the minimum sample requirement of 5 for each group (cell) (Hair et al., 2006, p. 112).

Personal factors competence affects the financial statements quality. The high personal factors competence will affect on the high financial statements quality. System/administration factors regulation affect the financial statement quality. The high system/administration factors regulation will affect on the high financial statements quality. Political factors affect the financial statements quality. The high political factors will affect on the high financial statements quality. Personal factor competence has no direct effect on the performance. The high personal factor competence will not affect the high or low of the performance. However, there is a significant indirect effect between personal factor competence on performance through the financial statements quality which means that higher personal factor competence will lead to higher performance through financial statements quality. System/administration factor regulation is not directly affects the performance. The high system/administration factor regulation will not affect on the high or low of the performance. However, there is a significant indirect effect between system/administration factor regulation on performance through the financial statements quality which means that higher the system/administration factor regulation will lead to higher performance through financial statements quality. Political factors is not directly affects the performance. The high political factors will not affect the high or low of the performance. However, there is a significant indirect effect between political factors on performance through the financial statements quality which means that the higher the political factor, it will leads to higher performance through the financial statements quality. Financial statements quality affects the performance. The high financial statements will affect on the performance.

The research issues raised are the increasing public demands for the government services and accountability, while on the other hand the government is faced with the report and financial quality that are below the expectation. This issue is a national strategic issue, leading this research to aim at providing guidelines that can help the regional government to formulate operational policies and strategies of the quality improvement of financial statement and performance of the regional government.

The purpose of this paper is to re-test the determinant factors of the quality of financial statements and performance of the government by adding contextual factors, such as the personal factor, system/administrative factor and political factor, that may affect the quality of financial statement information and performance of the government. The personal factor is proxied to the competencies that affect the quality of financial statements and performance. The social administrative factor is proxied on the regulations and presentation of quality financial statements.

The analysis unit in this study was conducted at the organizational level. The research object was in the South Sulawesi Province. This was a descriptive and verificative research with a survey technique. Based on the objectives of the research, this is an explanatory study. The research method used was an explanatory survey with a quantitative approach. The population of this research was proxied to the Regional Unit Organization (Organisasi Perangkat Desa/OPD) which compiled the financial statements in the South Sulawesi Provincial Government and consisted of 803 units of local government agencies (Satuan Kerja Perangkat Daerah or SKPD). The purposive sampling technique was chosen under the following criteria: the regional government whose financial statement has been audited by the BPK, the regional government whose financial accountability report has been evaluated by Indonesia’s Agency for Financial, and Development Supervision (Badan Pengawasan Keuangan dan Pembangunan or BPKP). In line with the criteria mentioned above, the minimum samples required for 26 observations/indicators are 5 × 26 = 130 respondents. The sample size met the minimum sample requirement of five for each group (cell) (Hair et al., 2006, p. 112).

The personal factor “competence” affects the financial statements’ quality. The high personal factor “competence” will affect the high financial statements’ quality. The system/administration factor “regulation” affects the financial statement quality. The high system/administration factor “regulation” will affect the high financial statements’ quality. Political factors affect the financial statements’ quality. The high political factors will affect the high financial statements’ quality. The personal factor “competence” has no direct effect on the performance. The high personal factor “competence” will not affect the high or low of the performance. However, there is a significant indirect effect between the personal factor “competence” on performance through the financial statements’ quality, which means that the higher personal factor “competence” will lead to higher performance through financial statements’ quality. The system/administration factor “regulation” does not directly affect the performance. The high system/administration factor “regulation” will not affect the high or low of the performance. However there is a significant indirect effect between the system/administration factor “regulation” on performance through the financial statements’ quality which means that higher system/administration factor “regulation” will lead to higher performance through financial statements’ quality. The political factor does not directly affect the performance. The high political factors will not affect the high or low of the performance. However there is a significant indirect effect between political factors on performance through the financial statements’ quality which means that the higher political factor will lead to higher performance through the financial statements’ quality. Financial statements’ quality affects the performance. The high financial statements will affect the performance.

The research issues raised are the increasing public demands for the government services and accountability, while on the other hand, the government is faced with the report and financial quality that are below the expectation. This issue is a national strategic issue, leading this research to aim at providing guidelines that can help the regional government to formulate operational policies and strategies for the quality improvement of financial statement and performance of the regional government.

The purpose of this paper is to examine the impact of audit quality, measured by financial statements audited by the big four accounting firms, on the investors' ability to predict future earnings for profitable and unprofitable firms.

The paper uses the returns‐earnings regression model and interacts all independent variables in this model with a dummy variable, AUDIT, which is set to equal one if financial statements audited by the big four accounting firms, zero otherwise. Future earnings response coefficient is the measure of earnings predictability.

The paper finds that investors are able to better anticipate future earnings when financial statements are audited by the big four accounting firms. However, the findings are not applicable for unprofitable firms.

The findings of the paper have implications for auditing related academic research and the users of financial statements. In particular, the study shows that the big four accounting firms have not lost their audit quality advantage and that financial statements audited by the big four accounting firms are arguably of higher quality than those audited by non‐big four accounting firms.

It is believed that there is no UK study to date examining the association of the quality of financial statements audited by the big four accounting firms and the returns‐earnings association. Consequently, this paper significantly contributes to the limited literature on the perceived value relevance of audit quality.

The increasing availability of eXtensible Business Reporting Language (XBRL) financial statements motivates additional investigation of whether XBRL’s search-facilitating technology (SFT) and enhanced viewing capabilities facilitate information search and improve financial analysis decision quality and efficiency. This experiment investigates how using XBRL technology to view financial statements influences novice investors’ decision quality by affecting decision processes such as search strategy and effort, as well as decision efficiency (accuracy/effort) in a financial statement analysis task. In the experiment, randomly assigned student participants (n = 102) invested in companies using either static PDF-formatted or XBRL-enabled financial statements. No differences in decision quality (i.e., accuracy) due to technology use were observed. However, participants in the XBRL condition examined less information, used more directed search processes, and evidenced greater efficiency than did participants assigned to the PDF condition. Hence, the results suggest that XBRL SFT affects the use of differing decision processes relative to PDF technology.

The main objective of this study is to investigate whether adoption of International Financial Reporting Standards (IFRS) improve the quality of financial reporting in Nigeria. Financial reporting quality was measured in terms of fundamental qualitative characteristics such as relevance and faithful representation and enhancing qualitative characteristics such as understandability, comparability, verifiability, and timeliness as contained in the conceptual framework. The study was conducted on a sample of 162 companies listed on the Nigerian Stock Exchange. A compound measurement tool in form of an index was developed to comprehensively assess the quality of financial reporting based on information disclosed in the financial statement of the selected companies. From both univariate and multivariate analysis, I found strong evidence suggesting that accounting standard used in the preparation of financial statement have significant influence on the quality of financial report of the reporting entity. The result persists for all the three models (overall financial reporting quality, fundamental, and enhancing qualitative characteristics) tested in this analysis. The result also revealed that apart from firm age and firm growth, most of the firm-specific variables investigated have statistically significant influence on the financial reporting quality.

Introduction: In the context of globalisation processes, the necessity to create appropriate information support for management decisions at various levels becomes increasingly important: at the international, national and enterprise levels. The source of such data is financial reporting. The last leads to increase attention from key users (investors, lenders, other users) to the reliability and quality of financial reporting data. The study of scientific literature and best foreign practices made it possible to identify problems of the theoretical, organisational and methodological background of preparing high-quality financial statements and their assessment, particularly the lack of a unified interpretation of the financial reporting quality concept. The necessity to identify a theoretical basis for assessing financial reporting quality has led to the relevance of this study.

Aim: Scientific substantiation and improvement of theoretical provisions of methodology development for financial reporting quality assessment.

Methods used within the study are the following: Analysis, synthesis, operational approach, bibliographic analysis, generalisation.

Findings: The application of an operational approach to the formulation of the definition of financial reporting quality has made it possible to create the basis for its assessment. This approach involves descriptions of the principles of clarity and uniformity. The authors define the concept of ‘financial reporting quality’, formulating the theoretical principles for financial reporting assessment as the process of establishing compliance of financial statements with a specific list of qualitative characteristics.

The study aims at reviewing a synthesis of disclosure, transparency, and International Financial Reporting Standards (IFRS) implementation in an attempt to provide directions for future research. Prior research overwhelmingly supports that the IFRS adoption or effective implementation of IFRS will enhance high-quality financial reporting, transparency, enhance the country’s investment environment, and foreign direct investment (FDI) (Dayanandan, Donker, Ivanof, & Karahan, 2016; Gláserová, 2013; Muniandy & Ali, 2012). However, some researchers provide conflicting evidence that developing countries implementing IFRS are probably not going to encounter higher FDI inflows (Gheorghe, 2009; Lasmin, 2012). It has also been argued that the IFRS adoption decreases the management earnings in countries with high levels of financial disclosure. In general, the study indicates that the adoption of IFRS has improved the financial reporting quality. The common law countries have strong rules to protect investors, strict legal enforcement, and high levels of transparency of financial information. From the extensive structured review of literature using the Scopus database tool, the study reviewed 105 articles, and in particular, the topic-related 94 articles were analysed. All 94 articles were retrieved from a range of 59 journals. Most of the articles (77 of 94) were published 2010–2018. The top five journals based on the citations are Journal of Accounting Research (187 citations), Abacus (125 citations), European Accounting Review (107 citations), Journal of Accounting and Economics (78 citations), and Accounting and Business Research (66 citations). The most-cited authors are Daske, Hail, Leuz, and Verdi (2013); Daske and Gebhardt (2006); and Brüggemann, Hitz, and Sellhorn (2013). Surprisingly, 65 of 94 articles did not utilise the theory. In particular, four theories have been used frequently: agency theory (15), economic theory (5), signalling theory (2), and accounting theory (2). The study calls for future research on the theoretical implications and policy-related research on disclosure and transparency which may inform the local and international standard setters.

The main objective on this research is providing evidence of the contagion effect of decreasing audit's quality. Audit failure affects the quality of the financial analysis that has been carried out and has a big impact on the accuracy of decision making due to the material information bias. Findings of this research will urge the Public Accounting Firm (PAF) to design a quality control of the audit services. This action is taken with the consideration of maintaining the quality of audit services and the reputation of auditors.

Utilizing manufacturing data listed on Bursa Efek Indonesia (BEI), the researchers developed a model to explain the audit failure which is seen from restatement of financial statement in the subsequent period.

This research indicates that audit failure to detect the misstatement will decrease the audit's quality of other companies audited by the same auditor. There is also an insight that contagion effect of decreasing auditor quality was stronger for non-big four and non-industry specialist auditors.

Audit failure still has the potential to occur. There is the potential that a failure in an audit of a particular client entity has an impact on defects of other clients served. If this allegation is proven, there are big challenges faced by the public accounting profession and PAF to pay special attention in order to maintain the professional reputation.

Professional body and government need to develop a robust standard and operating procedures as well as quality control on audit engagement.

Due to the intention of fraud occurred in Indonesia, namely SNP Finance and Garuda Indonesia case. It is important to learn from that cases. This research gives fruitful insights to prevent the same case in the future.

Smith (2003) responded to the Sarbanes‐Oxley Act by suggesting that government rules and regulations cannot preserve a profession where people lack integrity. He suggests that leaders in the profession and academe “call individuals to excellence” and “inculcate in practitioners and students ethical behaviour and personal integrity”. This study investigates whether auditors’ attitudes towards creative accounting are associated with ethical judgement, their evaluation of the quality of financial reporting and their perceptions of factors that influence preparers of financial statements to use aggressive accounting techniques. The results of this study reveal a significant relationship between auditors’ assessments of the relevance and reliability (but not ethical judgement) of reported information and their attitudes to creative accounting. Some insight is gained into auditors’ perceptions of the factors that influence preparers to use creative accounting in South Africa.