This paper studies the implementation of International Standards on Quality Control 1 (ISQC 1) am... more This paper studies the implementation of International Standards on Quality Control 1 (ISQC 1) among the small and medium audit firms in Malaysia. Since July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the approved standard of auditing in Malaysia. However, the implementation of ISQC 1 among small and medium audit firms in Malaysia is not encouraging. A focus group interview has been conducted to gain the perceptions of the practitioners from small and medium audit firms on the implementation of ISQC 1 in their firms. Results show that most of them are lack of exposure and knowledge on the ISQC 1 standards.
In July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the a... more In July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the approved standard of auditing in Malaysia. In assisting the implementation of ISQC 1 among audit firms, a guideline on the ISQC 1 requirement is essential. This paper provides insights on the development of International Standards on Quality Control 1 (ISQC 1) selfassessment checklist for small and medium audit firms in Malaysia. The checklist is developed based on ISQC1 requirements, ISQC 1 manual and MIA By-Laws. This checklist is also in-line with ISQC 1 questionnaires prepared by other countries such as Australia and Pakistan. It is then validated by audit practitioners. It is hoped that this audit quality system would assist the small and medium audit firms in improving and enhancing their audit service quality with the aspiration to be at par with the larger audit firms.
The main objective of this paper is to investigate the relationship between audit quality (measur... more The main objective of this paper is to investigate the relationship between audit quality (measured by auditor size) and corporate governance mechanism (Audit committee and Board of Director) impact on earnings management for IPO companies in Malaysia. This current study employs the modified Jones model 1995. The findings reveal that the audit quality proxy by auditor size does not have any significant relationship with earnings management for IPO companies in Malaysia. In addition, the independence of audit committee and total number of non-executive directors has positive relationship with earnings management. The possible reasons might be due to management dominance over board matters and lack of knowledge among the directors on the daily affairs of the company. Therefore, results from this study provide useful information for the accounting literature and practitioners on the effective practice of corporate governance mechanism (audit committee and Board of Directors) and the choice of auditors in Malaysia IPO companies.
Prior studies on management control in auditing firms focus on Big 4 firms. In Malaysia, the larg... more Prior studies on management control in auditing firms focus on Big 4 firms. In Malaysia, the large majority of auditing firms are of small and medium size creating the need to study control in these organizations. This study examines management control, in particular clan controls, in small and medium auditing firms by interviewing the partners. 6 partners form Big 4 and non Big 4 auditing firms were interviewed and the interview data were analyzed qualitatively. The findings reveal that strong leadership influence on clan control and less informal control mechanisms are prevalent in the small and medium size firms as compared to their counterpart, the Big 4 firms. The findings suggest a lack of sustainable control measures in small firms posing as a challenge in maintaining quality service.
This paper studies the implementation of International Standards on Quality Control 1 (ISQC 1) am... more This paper studies the implementation of International Standards on Quality Control 1 (ISQC 1) among the small and medium audit firms in Malaysia. Since July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the approved standard of auditing in Malaysia. However, the implementation of ISQC 1 among small and medium audit firms in Malaysia is not encouraging. A focus group interview has been conducted to gain the perceptions of the practitioners from small and medium audit firms on the implementation of ISQC 1 in their firms. Results show that most of them are lack of exposure and knowledge on the ISQC 1 standards.
In July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the a... more In July 2006, the Malaysian Institute of Accountant (MIA) has adopted the ISQC 1 as part of the approved standard of auditing in Malaysia. In assisting the implementation of ISQC 1 among audit firms, a guideline on the ISQC 1 requirement is essential. This paper provides insights on the development of International Standards on Quality Control 1 (ISQC 1) selfassessment checklist for small and medium audit firms in Malaysia. The checklist is developed based on ISQC1 requirements, ISQC 1 manual and MIA By-Laws. This checklist is also in-line with ISQC 1 questionnaires prepared by other countries such as Australia and Pakistan. It is then validated by audit practitioners. It is hoped that this audit quality system would assist the small and medium audit firms in improving and enhancing their audit service quality with the aspiration to be at par with the larger audit firms.
The main objective of this paper is to investigate the relationship between audit quality (measur... more The main objective of this paper is to investigate the relationship between audit quality (measured by auditor size) and corporate governance mechanism (Audit committee and Board of Director) impact on earnings management for IPO companies in Malaysia. This current study employs the modified Jones model 1995. The findings reveal that the audit quality proxy by auditor size does not have any significant relationship with earnings management for IPO companies in Malaysia. In addition, the independence of audit committee and total number of non-executive directors has positive relationship with earnings management. The possible reasons might be due to management dominance over board matters and lack of knowledge among the directors on the daily affairs of the company. Therefore, results from this study provide useful information for the accounting literature and practitioners on the effective practice of corporate governance mechanism (audit committee and Board of Directors) and the choice of auditors in Malaysia IPO companies.
Prior studies on management control in auditing firms focus on Big 4 firms. In Malaysia, the larg... more Prior studies on management control in auditing firms focus on Big 4 firms. In Malaysia, the large majority of auditing firms are of small and medium size creating the need to study control in these organizations. This study examines management control, in particular clan controls, in small and medium auditing firms by interviewing the partners. 6 partners form Big 4 and non Big 4 auditing firms were interviewed and the interview data were analyzed qualitatively. The findings reveal that strong leadership influence on clan control and less informal control mechanisms are prevalent in the small and medium size firms as compared to their counterpart, the Big 4 firms. The findings suggest a lack of sustainable control measures in small firms posing as a challenge in maintaining quality service.
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