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Dysfunctional audit behaviour: an exploratory study in Malaysia

Author

Listed:
  • Halil Paino
  • Zubaidah Ismail
  • Malcolm Smith

Abstract

Purpose - The quality of the opinion provided by audit firms is an important determinant of their long‐term survival, but audit quality is difficult to gauge, which makes it particularly sensitive to the behaviour of the individuals who carry on audit work. This paper seeks to identify the incidence of dysfunctional audit behaviours and audit quality reduction behaviours, actions taken by an auditor during engagement that reduce evidence‐gathering effectiveness. Design/methodology/approach - The paper is based on a survey of 244 auditors working in small/medium and big audit firms in Malaysia. Findings - The paper identifies key variables leading to dysfunctional audit behaviour. Research limitations/implications - The paper is subject to the normal limitations associated with survey research. Practical implications - The paper provides basic empirical evidence of a potentially serious risk of dysfunctional behaviours that may impair audit quality. Originality/value - The paper provides empirical evidence to address the concerns of the Malaysian regulatory authorities regarding audit quality.

Suggested Citation

  • Halil Paino & Zubaidah Ismail & Malcolm Smith, 2010. "Dysfunctional audit behaviour: an exploratory study in Malaysia," Asian Review of Accounting, Emerald Group Publishing Limited, vol. 18(2), pages 162-173, July.
    • Handle: RePEc:eme:arapps:v:18:y:2010:i:2:p:162-173
    DOI: 10.1108/13217341011059417
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    References listed on IDEAS

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    1. Jaworski, Bernard J. & Young, S. Mark, 1992. "Dysfunctional behavior and management control: An empirical study of marketing managers," Accounting, Organizations and Society, Elsevier, vol. 17(1), pages 17-35, January.
    2. Paul Coram & Juliana Ng & David Woodliff, 2003. "A Survey of Time Budget Pressure and Reduced Audit Quality Among Australian Auditors," Australian Accounting Review, CPA Australia, vol. 13(29), pages 38-44, March.
    3. McNair, C. J., 1991. "Proper compromises: The management control dilemma in public accounting and its impact on auditor behavior," Accounting, Organizations and Society, Elsevier, vol. 16(7), pages 635-653.
    4. Otley, David T. & Pierce, Bernard J., 1995. "The control problem in public accounting firms: An empirical study of the impact of leadership style," Accounting, Organizations and Society, Elsevier, vol. 20(5), pages 405-420, July.
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    Citations

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    Cited by:

    1. Halil Paino & Malcolm Smith & Zubaidah Ismail, 2012. "Auditor acceptance of dysfunctional behaviour," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 13(1), pages 37-55, May.
    2. Pernilla Broberg & Torbjörn Tagesson & Daniela Argento & Niclas Gyllengahm & Ola Mårtensson, 2017. "Explaining the influence of time budget pressure on audit quality in Sweden," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 21(2), pages 331-350, June.
    3. Gerald Kasigwa, 2014. "Reduced Audit Quality Behavior Scale: Exploratory and Confirmatory Analysis Based on a Sample of External Auditors in Uganda," Journal of Economics and Behavioral Studies, AMH International, vol. 6(1), pages 21-31.
    4. Seif Obeid Al-Shbiel, 2016. "An Examination the Factors Influence on Unethical Behaviour among Jordanian external auditors: Job Satisfaction as a mediator," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 6(3), pages 285-296, July.

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    Keywords

    Auditing; Behaviour; Malaysia;
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