Communicating key audit matters of listed

Chanida Yarana, Suntaree Tangsriwong, Pattaraporn Pongsaporamat, Sirat Sonchai

Abstract


Abstract— This research mainly aims (1) to study key audit matters (KAM) which are presented in auditors' reports of listed firms in the Stock Exchange of Thailand (SET), (2) to gather and analyze contents of key audit matters of Thai listed firms, and (3) to compare characteristics of KAM in each industry. The auditors' reports from listed companies in Thailand have been in compliance with the International Standard on Auditing no. 700 and 701 since 2016. The KAM data was collected from auditors' reports which were disclosed on the website of the Stock Exchange of Thailand (SET) from the year 2016 to 2017. The results show that the new auditors' reports from Big-4 audit firms contain more pages than reports from non-Big 4 firms, on average. Moreover, the results also reveal that the top-three rankings of KAM contents during the year 2016 and 2017 are (1) Revenue Recognition, (2) Investment and asset valuation and their impairment, and (3) Inventory Valuation. Classified firms by industry, the results show that the most frequently reported KAM contents in each industry is Revenue Recognition except the Industrials and Consumer Products industry where KAM contents report Inventory Valuation as the first rank.
Keywords— New auditor’s reports, Key audit matters, Auditing


Full Text:

PDF

References


C. W. Chow and S. Rice, “Qualified audit opinions and share

prices – An investigation Auditing”. A Journal of Practices &

Theory, vol.1, pp. 35-53, Winter 1982.

N. Dopuch, R. Holthausen, R. Leftwich, “Abnormal stock returns

associated with media disclosures of ‘subject to’ qualified audit

opinion”. A Journal of Accounting and Economics, vol.8,

pp. 93 – 117, 1986.

M.L. Loudder, I.K. Khurana, R.B. Sawyers, C. Cordery, C.

Johnson, R. Wunderle, “The information content of audit

qualifications”. Journal of Practice & Theory, vol.11, pp. 69 - 82,

January1992.

K. Menon and D.D. William, “Investor reaction to going concern

audit reports”. The Accounting Review, vol.85, pp. 2075 - 2105,

International Federation of Accountants (IFAC), “Proposed

International Standard on Auditing (ISA) 700 (Revised)

Forming an Opinion and Reporting on Financial Statement”.

a.

International Federation of Accountants (IFAC), “Proposed

International Standard on Auditing (ISA) 701 Communicating

Key Audit Matters in the Independent Auditor’s Report”. 2016 b.

C. Tangruenrat, “New Auditor’s Report: The 1st – year

Experiences”. Journal of Accounting Profession, no. 13, vol.38,

pp. 6 - 21, June 2017.

S. Srijunpetch, “New auditor’s report (again)”. [Online].

Available:

http//www.tbs.tu.ac.th/wp-content/uploads/2017, May 2018.

M.C. Jensen and W.H. Meckling, “Theory of the firm:

Managerial behavior, agency costs and ownership structure”.

Journal of Financial Economics, no. 3, vol.4, pp. 305 - 360, 1976.

doi: 10.1016/0304-405X(76)90026-X

D. Tatiana and S. Ovidiu, “Audit opinion impact in the

investors’ perception – empirical evidence on Bucharest Stock

Exchange”. Audit Financiar, no. 16, vol.149, pp. 111 - 121,

doi:10.20869/AUDITF/2018/149/111

S. Pornupatham and T. Wijitsarawong, “). Proposed new

auditor’s report: a challenge of auditors and users of financial

statements”. Chulalongkorn Business Review, no. 36, vol.3, pp.

- 54, July – September, 2014.

B.B Dogan and B. Arefaine, The implementation of ISA 701-

key audit matters: Empirical evidence on auditors’ adjustments

in the new audit report.”, 2017.


Refbacks

  • There are currently no refbacks.