(paper withdrawn) Signaling Theory Embedded in the Throughput Model to Examine the Governance of How External Auditors Rely on Internal Audit Function

DOI

10.2991/icaat-16.2016.40How to use a DOI?

Keywords

ISA 610 (Revised 2013), Reliance Decision, Throughput Model, Signaling Theory

Abstract

This study examines the governance of how external auditors (EAs) rely on internal audit function (IAF) from a new perspective. We use Signaling Theory embedded in a Throughput Model to trace the sub-processes of different stages of the reliance decision. We consider the last revision made to the International Standard on Auditing 610 (ISA 610) in 2013, the three types of sourcing arrangements for IAF, the incomplete picture presented in the literature of the pre-procedures of reliance on IAF, Signaling Theory, and the Throughput Model to develop a model predicting the nature and extent of EA reliance on IAF in different circumstances. We contribute to the literature by examining the interactions among different factors to better understand the process of making a reliance decision, as well as explaining how EAs incorporate the requirements of ISA 610 in a reliance decision. This study also has practical implications that could be of interest to many different parties, such as professionals connected with the ISA, EAs, IAF and auditees. That is, these parties can influence IAF contributions to the external audit of financial statement thereby increasing its efficiencies.

Copyright

© 2016, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Waymond Rodgers
AU  - Ibrahim Albawwat
PY  - 2016/12
DA  - 2016/12
TI  - (paper withdrawn) Signaling Theory Embedded in the Throughput Model to Examine the Governance of How External Auditors Rely on Internal Audit Function
BT  - Proceedings of the 5th International Conference on Accounting, Auditing, and Taxation (ICAAT 2016)
PB  - Atlantis Press
SN  - 2352-5428
UR  - https://doi.org/10.2991/icaat-16.2016.40
DO  - 10.2991/icaat-16.2016.40
ID  - Rodgers2016/12
ER  -