Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/009
Delia Deliu
In today's rapidly evolving world, the importance of sustainability and circularity has become more prominent than ever. Businesses and economies worldwide are recognizing the need to transition towards a circular model, where resources are used efficiently and waste is minimized. This transition necessitates changes across all sectors, including financial auditing. While the main object of financial audit is to provide an opinion on financial statements to ensure that it gives true and fair view of the accounts, the auditor will also need to assess an organization's sustainability by evaluating its environmental and social impact, resource efficiency, and circularity performance. It becomes more and more important that the financial auditor should provide a comprehensive assessment of the organization's sustainability practices, enabling stakeholders to understand its commitment to environmental responsibility, social equity, and economic resilience. Auditing sustainability reporting involves different challenges compared to those encountered in auditing financial statements. The independent audit report issued by the financial auditor on sustainability reporting plays an essential role in building confidence in the robustness of non-financial information, providing benefits such as: ensuring the credibility of ESG information presentations within the annual report; creating a positive impact on the company's reputation; strengthening the company's awareness of material ESG risks and facilitating the improvement of internal systems, processes and controls and the company's performance in the ESG area; better positioning of the company in ESG rating rankings. Hence, auditing sustainability reporting goes beyond financial metrics and includes non-financial indicators that reflect the organization's triple bottom line – people, planet, and profit. Henceforth, by expanding the scope of financial audits to incorporate sustainability metrics, audit companies can demonstrate their commitment to the circular economy and provide transparency regarding their clients’ environmental and social performance. Henceforward, auditing sustainability reporting not only enables stakeholders to make informed decisions, but also promotes accountability and incentivizes organizations to adopt circular practices. In this context, to effectively track, measure, and assess the sustainability performance of organizations, emerging technologies play a crucial role. This paper explores the role of emerging technologies in facilitating the transition of financial auditing towards a circular economy by employing a Reflexive Thematic Analysis (RTA). Analyzing the literature on the subject is the first step in the process, which is followed by a reflective study of the underlying themes and their consequences for financial auditing procedures. Several important themes emerged, highlighting the benefits, difficulties, as well as moral and social ramifications of integrating mode
{"title":"“Sustaining the Sustainable Sustainability”: Leveraging Digitalization and Emerging Technologies by the Auditor in Providing Assurance on Sustainability Reporting","authors":"Delia Deliu","doi":"10.20869/auditf/2024/174/009","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/009","url":null,"abstract":"In today's rapidly evolving world, the importance of sustainability and circularity has become more prominent than ever. Businesses and economies worldwide are recognizing the need to transition towards a circular model, where resources are used efficiently and waste is minimized. This transition necessitates changes across all sectors, including financial auditing. While the main object of financial audit is to provide an opinion on financial statements to ensure that it gives true and fair view of the accounts, the auditor will also need to assess an organization's sustainability by evaluating its environmental and social impact, resource efficiency, and circularity performance. It becomes more and more important that the financial auditor should provide a comprehensive assessment of the organization's sustainability practices, enabling stakeholders to understand its commitment to environmental responsibility, social equity, and economic resilience. Auditing sustainability reporting involves different challenges compared to those encountered in auditing financial statements. The independent audit report issued by the financial auditor on sustainability reporting plays an essential role in building confidence in the robustness of non-financial information, providing benefits such as: ensuring the credibility of ESG information presentations within the annual report; creating a positive impact on the company's reputation; strengthening the company's awareness of material ESG risks and facilitating the improvement of internal systems, processes and controls and the company's performance in the ESG area; better positioning of the company in ESG rating rankings. Hence, auditing sustainability reporting goes beyond financial metrics and includes non-financial indicators that reflect the organization's triple bottom line – people, planet, and profit. Henceforth, by expanding the scope of financial audits to incorporate sustainability metrics, audit companies can demonstrate their commitment to the circular economy and provide transparency regarding their clients’ environmental and social performance. Henceforward, auditing sustainability reporting not only enables stakeholders to make informed decisions, but also promotes accountability and incentivizes organizations to adopt circular practices. In this context, to effectively track, measure, and assess the sustainability performance of organizations, emerging technologies play a crucial role. This paper explores the role of emerging technologies in facilitating the transition of financial auditing towards a circular economy by employing a Reflexive Thematic Analysis (RTA). Analyzing the literature on the subject is the first step in the process, which is followed by a reflective study of the underlying themes and their consequences for financial auditing procedures. Several important themes emerged, highlighting the benefits, difficulties, as well as moral and social ramifications of integrating mode","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140701214","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/014
C. Lungu, O. Bunget
Audit quality is one of the most important concerns of audit firms, statutory audit regulators and academia. The purpose of this study is to analyze and evaluate the influence of auditor independence indicators on the quality of services provided. Based on the data available in the Audit Analytics database, a sample of 31 companies listed on the Bucharest Stock Exchange was selected, for which 124 observations were reported during four consecutive years. The results of the quantitative analysis performed demonstrated the existence of a significant and positive correlation between the variables that measure auditor independence, such as the provision of non-audit services, financial independence, Big 4 membership and turnover and the dependent variable - the quality of audit services.
{"title":"Audit Quality Assessed through Independence Indicators","authors":"C. Lungu, O. Bunget","doi":"10.20869/auditf/2024/174/014","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/014","url":null,"abstract":"Audit quality is one of the most important concerns of audit firms, statutory audit regulators and academia. The purpose of this study is to analyze and evaluate the influence of auditor independence indicators on the quality of services provided. Based on the data available in the Audit Analytics database, a sample of 31 companies listed on the Bucharest Stock Exchange was selected, for which 124 observations were reported during four consecutive years. The results of the quantitative analysis performed demonstrated the existence of a significant and positive correlation between the variables that measure auditor independence, such as the provision of non-audit services, financial independence, Big 4 membership and turnover and the dependent variable - the quality of audit services.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140703101","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/013
A. Groşanu, M. Fulop, Nicolae Măgdaș
The proposed study expresses some considerations about the digital transition in the accounting profession, especially its metaverse aspects. The main reason for this investigation is the importance of the topic in a world that is constantly changing. When reviewing the literature on this topic, the authors found several studies related to the role and importance of metaverse in the accounting profession. In their analysis, the authors conducted a qualitative study that focusses on the role and importance of the metaverse and its scope in the accounting profession. The results of the research show that although the digital transition is not at the beginning of the road, we must adapt to the new changes, so a professional accountant must also have significant knowledge in the field of IT. Following this study, the authors concluded that the role of the digital transition in the accounting profession is essential to face the new demands on the market and to respond in the shortest possible time to the demands of clients.
{"title":"Auditing in the Metaverse, the “New Reality”","authors":"A. Groşanu, M. Fulop, Nicolae Măgdaș","doi":"10.20869/auditf/2024/174/013","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/013","url":null,"abstract":"The proposed study expresses some considerations about the digital transition in the accounting profession, especially its metaverse aspects. The main reason for this investigation is the importance of the topic in a world that is constantly changing. When reviewing the literature on this topic, the authors found several studies related to the role and importance of metaverse in the accounting profession. In their analysis, the authors conducted a qualitative study that focusses on the role and importance of the metaverse and its scope in the accounting profession. The results of the research show that although the digital transition is not at the beginning of the road, we must adapt to the new changes, so a professional accountant must also have significant knowledge in the field of IT. Following this study, the authors concluded that the role of the digital transition in the accounting profession is essential to face the new demands on the market and to respond in the shortest possible time to the demands of clients.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140698961","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/008
O. Bunget, A. Dumitrescu, Anca Diana Sumanaru, C. Lungu
This paper seeks to present the auditor-client negotiation process from non-financial assurance perspective, as to understand those factors that determine the way auditors conduct negotiations. For this, the authors analyzed a series of articles and publications extracted from Web of Science (WOS) or other research databases. These were selected based on their research topic, that focused mainly on auditor-client negotiation, assurance mission, and non-financial reporting. Further, the paper investigates most relevant research publications starting from year 2000 until present (from citations and journal ranking point of view) with the purpose of identifying those factors influencing the negotiation process when auditing non-financial information. In addition, this qualitative research represents a literature review synthesis of most relevant articles.
{"title":"Auditor-Client Negotiation in Non-Financial Reporting Assurance Missions","authors":"O. Bunget, A. Dumitrescu, Anca Diana Sumanaru, C. Lungu","doi":"10.20869/auditf/2024/174/008","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/008","url":null,"abstract":"This paper seeks to present the auditor-client negotiation process from non-financial assurance perspective, as to understand those factors that determine the way auditors conduct negotiations. For this, the authors analyzed a series of articles and publications extracted from Web of Science (WOS) or other research databases. These were selected based on their research topic, that focused mainly on auditor-client negotiation, assurance mission, and non-financial reporting. Further, the paper investigates most relevant research publications starting from year 2000 until present (from citations and journal ranking point of view) with the purpose of identifying those factors influencing the negotiation process when auditing non-financial information. In addition, this qualitative research represents a literature review synthesis of most relevant articles.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140699686","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/012
Mihai Lupu, Magda Ghica, Cornelia Nastase
In an economy strongly marked by globalisation, transfer pricing is at the top of the agenda of taxpayers, tax authorities and regulatory bodies, with its influence manifested primarily in the fiscal area, respectively in the correct determination and proper allocation of the corporate tax base between different jurisdictions or between companies operating within the same jurisdiction. However, transfer pricing transcends the fiscal problematic and significantly influences other aspects of a company's life, one of which is the image reflected in the annual financial statements, including cash flows or financial performance indicators, and through their analysis, the investment decisions of potential users of accounting information. Transfer pricing is, therefore, also a reference point in the audit work carried out at the level of companies part of national or multinational groups and involved in significant intra-group transactions, as compliance or noncompliance with the arm’s length principle directly influences the way in which different elements of income, expenses, results, assets, equity or liabilities are reflected or not in accordance with the true and fair view principle and thus, ultimately, the audit opinion. National and international auditing standards provide recommendations and guidance on how to deal with transfer pricing issues as part of audit engagements, reflecting a continuing concern by professional bodies to develop best practices in this area.
{"title":"The Impact of Transfer Pricing on the Company’s Image. Implications in Audit Work","authors":"Mihai Lupu, Magda Ghica, Cornelia Nastase","doi":"10.20869/auditf/2024/174/012","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/012","url":null,"abstract":"In an economy strongly marked by globalisation, transfer pricing is at the top of the agenda of taxpayers, tax authorities and regulatory bodies, with its influence manifested primarily in the fiscal area, respectively in the correct determination and proper allocation of the corporate tax base between different jurisdictions or between companies operating within the same jurisdiction. However, transfer pricing transcends the fiscal problematic and significantly influences other aspects of a company's life, one of which is the image reflected in the annual financial statements, including cash flows or financial performance indicators, and through their analysis, the investment decisions of potential users of accounting information. Transfer pricing is, therefore, also a reference point in the audit work carried out at the level of companies part of national or multinational groups and involved in significant intra-group transactions, as compliance or noncompliance with the arm’s length principle directly influences the way in which different elements of income, expenses, results, assets, equity or liabilities are reflected or not in accordance with the true and fair view principle and thus, ultimately, the audit opinion. National and international auditing standards provide recommendations and guidance on how to deal with transfer pricing issues as part of audit engagements, reflecting a continuing concern by professional bodies to develop best practices in this area.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140700176","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-04-15DOI: 10.20869/auditf/2024/174/011
George Aevoae
Corporations often acquire stakes in other companies. These stakes do or do not grant them control but they definitely allow the acquirers to use target companies’ resources to increase their profitability, access technological progress and innovation, develop products, or obtain dividends, as a part of their strategic transactions. The main objective of this article is to assess the stake purchased in acquisitions, based on information related to the size of the target companies and the premium paid, based on a sample of 2.565 acquisitions which involved at least one Romanian company, for the 2010-2018 period of time. The result show that the influence is negative and significant for the entire sample. When considering the accounting practices of the target companies, large stakes are purchased in companies which apply local GAAP, compared to IFRS. The second part of the study focuses on Romanian mergers, which are regulated separately by the OMPF no. 897/2015. In the case of these transactions, the target companies, in most cases, report a negative book value of equity.
{"title":"Analyzing the Dynamics of the Romanian M&A Market. Empirical Evidence Regarding the Premiums Paid in Transactions","authors":"George Aevoae","doi":"10.20869/auditf/2024/174/011","DOIUrl":"https://doi.org/10.20869/auditf/2024/174/011","url":null,"abstract":"Corporations often acquire stakes in other companies. These stakes do or do not grant them control but they definitely allow the acquirers to use target companies’ resources to increase their profitability, access technological progress and innovation, develop products, or obtain dividends, as a part of their strategic transactions. The main objective of this article is to assess the stake purchased in acquisitions, based on information related to the size of the target companies and the premium paid, based on a sample of 2.565 acquisitions which involved at least one Romanian company, for the 2010-2018 period of time. The result show that the influence is negative and significant for the entire sample. When considering the accounting practices of the target companies, large stakes are purchased in companies which apply local GAAP, compared to IFRS. The second part of the study focuses on Romanian mergers, which are regulated separately by the OMPF no. 897/2015. In the case of these transactions, the target companies, in most cases, report a negative book value of equity.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140700165","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-11-23DOI: 10.20869/auditf/2023/172/027
S. Rîndașu, Liliana Ionescu-Feleagă, Bogdan-Stefan Ionescu, I. Topor
The Fourth Industrial Revolution is bringing significant changes to the digital skill set required of management accountants. Thus, to continue ensuring the profession's relevance, academia and professional bodies constantly seek to update their curricula to meet the business environment's necessities. Thus, the present research aims to identify the digital skills management accounting practitioners need by examining the companies' requirements and determining whether there are significant differences between European Union (EU) member states regarding the countries' digital performance. This study adopts a mixed-methods approach by combining qualitative and quantitative research methods to achieve this objective. The results obtained from the undertaken analyses reveal that most companies consider necessary basic digital skills, such as the effective use of spreadsheet software and competencies related to integrated systems, Business Intelligence, database management systems, and data warehouse management systems. In addition, the comparative review reveals that in countries with a high level of digital performance there is a significant impact on the professional requirements, with no differences being identified between countries with a medium and low level of digital performance, emphasising the changing role of practitioners as a result of the extensive management accounting processes' digitalisation. The research findings consequently have a series of implications for academia,professional bodies, and companies.
{"title":"Digital Skills of Management Accountants: A Comparative Analysis across EU Countries","authors":"S. Rîndașu, Liliana Ionescu-Feleagă, Bogdan-Stefan Ionescu, I. Topor","doi":"10.20869/auditf/2023/172/027","DOIUrl":"https://doi.org/10.20869/auditf/2023/172/027","url":null,"abstract":"The Fourth Industrial Revolution is bringing significant changes to the digital skill set required of management accountants. Thus, to continue ensuring the profession's relevance, academia and professional bodies constantly seek to update their curricula to meet the business environment's necessities. Thus, the present research aims to identify the digital skills management accounting practitioners need by examining the companies' requirements and determining whether there are significant differences between European Union (EU) member states regarding the countries' digital performance. This study adopts a mixed-methods approach by combining qualitative and quantitative research methods to achieve this objective. The results obtained from the undertaken analyses reveal that most companies consider necessary basic digital skills, such as the effective use of spreadsheet software and competencies related to integrated systems, Business Intelligence, database management systems, and data warehouse management systems. In addition, the comparative review reveals that in countries with a high level of digital performance there is a significant impact on the professional requirements, with no differences being identified between countries with a medium and low level of digital performance, emphasising the changing role of practitioners as a result of the extensive management accounting processes' digitalisation. The research findings consequently have a series of implications for academia,professional bodies, and companies.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-11-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139242517","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-11-23DOI: 10.20869/auditf/2023/172/025
Adriana Duțescu, M. Mihai
The purpose of this research is to improve the understanding of the external technological context of Artificial Intelligence applied in financial services, together with other technological solutions such as digitization, automation, cloud computing and licensing. The authors studied the external technological context by analyzing the technology providers that are represented by the companies with CAEN code 620 – Service activities in information technology. The purpose of this study was to obtain and analyze answers to six research questions, as follows: what is the role of service providers, what are the other technologies offered by them together with Artificial Intelligence, how can this technology be effectively implemented, what is the involvement users in application development, if there will be specific training and what is the level of implementation of Artificial Intelligence in financial services. The authors found that often the investigated companies use their technology services only for banks, Fintech and large financial companies. Therefore, for small and medium-sized companies, the service providers included in the study are not suitable, and further research should be carried out in this regard. An interesting result emerged from the study of long-term relationships between the technology company and the financial company to improve the solutions and provide the necessary maintenance services until the solutions provide results with close to 100% accuracy.
{"title":"The External Technological Context of Artificial Intelligence in Financial Services","authors":"Adriana Duțescu, M. Mihai","doi":"10.20869/auditf/2023/172/025","DOIUrl":"https://doi.org/10.20869/auditf/2023/172/025","url":null,"abstract":"The purpose of this research is to improve the understanding of the external technological context of Artificial Intelligence applied in financial services, together with other technological solutions such as digitization, automation, cloud computing and licensing. The authors studied the external technological context by analyzing the technology providers that are represented by the companies with CAEN code 620 – Service activities in information technology. The purpose of this study was to obtain and analyze answers to six research questions, as follows: what is the role of service providers, what are the other technologies offered by them together with Artificial Intelligence, how can this technology be effectively implemented, what is the involvement users in application development, if there will be specific training and what is the level of implementation of Artificial Intelligence in financial services. The authors found that often the investigated companies use their technology services only for banks, Fintech and large financial companies. Therefore, for small and medium-sized companies, the service providers included in the study are not suitable, and further research should be carried out in this regard. An interesting result emerged from the study of long-term relationships between the technology company and the financial company to improve the solutions and provide the necessary maintenance services until the solutions provide results with close to 100% accuracy.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-11-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139246161","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-11-23DOI: 10.20869/auditf/2023/172/023
Maria Grosu, Costel Istrate, I. Robu
Sustainable development of the company implies achieving a balance in terms of economic, social and environmental activities with the aim of making optimal use of the entity's resources without harming the environment and through an active involvement of the company in society. To this end, an important role is played by the financial auditor, the guarantor of transparency in financial reporting and an active player in enforcing discipline in sustainable reporting. Through the audit report, including the opinion expressed, the auditor contributes to the credibility of the audited financial statements and inspires confidence in all users. The purpose of this study is to test the influence of the audit opinion and the auditor's membership of the Big4 group of companies on key indicators of financial position and performance, as well as on the use of performance management operations. The study also tested the influence of the audit opinion, in conjunction with the influence of key financial indicators, on the probability of reporting Key Audit Matters (KAM) related to earnings management operations or going concern. The study was conducted at the level of Romanian companies listed on the Bucharest Stock Exchange (BSE) – Regulated Market, in the period 2012-2022. Using advanced statistical methods of data analysis, the main results of the study indicate the existence of a significant influence of the previous year's audit opinion expressed by a particular type of auditor on key indicators of financial position and performance, as well as on discretionary accruals. At the same time, the prior year audit opinion as well as the current year values of the key financial indicators analysed have a significant influence on the probability of reporting on Key Audit Matters (KAM) related to earnings management operations or going concern.
{"title":"Empirical Study on the Analysis of the Financial Auditor`s Concern in Ensuring the Transparency and Sustainable Performance of BSE Listed Companies","authors":"Maria Grosu, Costel Istrate, I. Robu","doi":"10.20869/auditf/2023/172/023","DOIUrl":"https://doi.org/10.20869/auditf/2023/172/023","url":null,"abstract":"Sustainable development of the company implies achieving a balance in terms of economic, social and environmental activities with the aim of making optimal use of the entity's resources without harming the environment and through an active involvement of the company in society. To this end, an important role is played by the financial auditor, the guarantor of transparency in financial reporting and an active player in enforcing discipline in sustainable reporting. Through the audit report, including the opinion expressed, the auditor contributes to the credibility of the audited financial statements and inspires confidence in all users. The purpose of this study is to test the influence of the audit opinion and the auditor's membership of the Big4 group of companies on key indicators of financial position and performance, as well as on the use of performance management operations. The study also tested the influence of the audit opinion, in conjunction with the influence of key financial indicators, on the probability of reporting Key Audit Matters (KAM) related to earnings management operations or going concern. The study was conducted at the level of Romanian companies listed on the Bucharest Stock Exchange (BSE) – Regulated Market, in the period 2012-2022. Using advanced statistical methods of data analysis, the main results of the study indicate the existence of a significant influence of the previous year's audit opinion expressed by a particular type of auditor on key indicators of financial position and performance, as well as on discretionary accruals. At the same time, the prior year audit opinion as well as the current year values of the key financial indicators analysed have a significant influence on the probability of reporting on Key Audit Matters (KAM) related to earnings management operations or going concern.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-11-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139244855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-11-23DOI: 10.20869/auditf/2023/172/026
Mihaela Enachi, Daniel Botez
The European Green Deal brings into attention a new strategy to support the transition to a society that will meet the challenges of climate change and environmental degradation, improving the quality of life. Given the multitude of actors involved in the process of collecting, processing and communicating information on the impact of different activities on the environment and citizens, it is necessary to have a legal framework on sustainability reporting as rigorously as possible, in order to ensure the comparability in time and space of the information provided. For this information, reported at the European Union (EU) level, to allow decision-making at the right time, it is necessary to use digital technologies to facilitate the process of collecting, analysing and interpreting information. In this paper the authors tried to offer a practical example on how eXtensible Business Reporting Language (XBRL) works in order to highlight the benefits of this modern language in the context of the Green Deal. In this regard, using Altova MissionKit 2023, the authors designed an XBRL taxonomy which is the basis for the development of an instance in which we find some representative indicators for the circular economy, an environmental objective of the EU taxonomy. The XBRL language simplifies the transfer of information from sustainability reports prepared in different countries to the European Commission, improving and accelerating the decision-making process.
{"title":"Using XBRL for Sustainability Reporting under the European Green Deal","authors":"Mihaela Enachi, Daniel Botez","doi":"10.20869/auditf/2023/172/026","DOIUrl":"https://doi.org/10.20869/auditf/2023/172/026","url":null,"abstract":"The European Green Deal brings into attention a new strategy to support the transition to a society that will meet the challenges of climate change and environmental degradation, improving the quality of life. Given the multitude of actors involved in the process of collecting, processing and communicating information on the impact of different activities on the environment and citizens, it is necessary to have a legal framework on sustainability reporting as rigorously as possible, in order to ensure the comparability in time and space of the information provided. For this information, reported at the European Union (EU) level, to allow decision-making at the right time, it is necessary to use digital technologies to facilitate the process of collecting, analysing and interpreting information. In this paper the authors tried to offer a practical example on how eXtensible Business Reporting Language (XBRL) works in order to highlight the benefits of this modern language in the context of the Green Deal. In this regard, using Altova MissionKit 2023, the authors designed an XBRL taxonomy which is the basis for the development of an instance in which we find some representative indicators for the circular economy, an environmental objective of the EU taxonomy. The XBRL language simplifies the transfer of information from sustainability reports prepared in different countries to the European Commission, improving and accelerating the decision-making process.","PeriodicalId":30958,"journal":{"name":"Audit Financiar","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-11-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139242705","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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