Exploring Changing Requirements of Financial Statement Audit Reports via a Morphogenetic Approach

Article


Deng, Ying, Bowrey, Graham and Jones, Greg. 2021. "Exploring Changing Requirements of Financial Statement Audit Reports via a Morphogenetic Approach." Australasian Accounting Business and Finance Journal. 15 (2), pp. 38-55. https://doi.org/10.14453/aabfj.v15i2.4
Article Title

Exploring Changing Requirements of Financial Statement Audit Reports via a Morphogenetic Approach

ERA Journal ID40372
Article CategoryArticle
AuthorsDeng, Ying (Author), Bowrey, Graham (Author) and Jones, Greg (Author)
Journal TitleAustralasian Accounting Business and Finance Journal
Journal Citation15 (2), pp. 38-55
Article Number4
Number of Pages19
Year2021
Place of PublicationAustralia
ISSN1834-2000
1834-2019
Digital Object Identifier (DOI)https://doi.org/10.14453/aabfj.v15i2.4
Web Address (URL)https://ro.uow.edu.au/aabfj/vol15/iss2/4/
Abstract

There has been an ongoing concern with the quality of financial audit reports issued by registered public accounting firms in relation to financial accountability and transparency of the financial statements. In July 2009 the Public Accounting Oversight Board (PCAOB) released a concept paper outlining changes to the requirements of financial audit activities such as the inclusion of the engagement partner’s signature on the financial audit reports. The aim of these new requirements was to improve the accountability of engagement partners as well as enhance the perception of transparency of the audit reports. However, the contribution and effectiveness of these requirements to improve accountability and transparency of audit reports for various stakeholders relying on the audited financial information is questionable. This study explores the impact and effectiveness of changes to auditing regulation and processes through the application of Archer’s (1995) morphogenetic approach which is based on social conditioning, social interaction, and social elaboration where the structural influences provides the environment for agents to differentiate themselves. In addition, this study demonstrates how proposed regulation changes mould the qualities of audit regulation, the profession and the auditor whose perspectives deserved to be noticed from the dominant constituencies structured by the propositions of a morphogenetic analysis.

KeywordsMorphogenetic approach; auditing; accountability; transparency; social agents
ANZSRC Field of Research 2020350103. Financial accounting
350199. Accounting, auditing and accountability not elsewhere classified
350101. Accounting theory and standards
Byline AffiliationsZhejiang University of Finance and Economics, China
University of the Sunshine Coast
University of Southern Queensland
Institution of OriginUniversity of Southern Queensland
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