The objective of this study is to address the gap that exists in the literature regarding quantifiable guidelines, benchmarks and consistency of applications. During the research acceptable benchmarks for the calculation or quantification of the elements linked to materiality and audit risk were found. The benchmarks are in compliance with the practices and the requirements of the ISAs and regulations. Models and benchmarks based on literature were used as a basis and modified for application in the auditing environment. The combination of literature, responses from public practitioners and experience based on best practices resulted in the development of a modified risk-based assessment model. The conclusion from the empirical study indicated that there are no defined rules or basis for calculating materiality and audit risk. The inconsistencies in responses indicate that audit firms and developer of key concepts interpret and apply the above-mentioned term different in practice. The interpretations of the relevant ISAs, appear to be conceptually correct as no major non-compliances were identified. Various instances indicated that there is a lack of guidance with regard to the quantification or qualification of benchmarks. The implementation of the Sarbanes-Oxley Act (2002) was an event that leads to the consideration of more conservative benchmarks. The most consistent benchmark that stood the test of time was Discussion paper 6 (1984). The 30 years since the development of these benchmarks indicate that little attention has been given to one of the most complex issues in auditing. Companies within different industries are not generic and exceptions will occur where the auditor needs to apply professional judgment to accommodate the deviations. Further research is required to assist the audit professionals and students in the development of consistent benchmarks to increase the reputation of the profession. The conclusion drawn from this study is that audit materiality and audit risk has a significant impact on the audit process as even the audit report is influenced by proper audit planning and guidelines to support the auditor in audits. / MCom (Accountancy), North-West University, Vaal Triangle Campus, 2013

The objective of this study is to address the gap that exists in the literature regarding quantifiable guidelines, benchmarks and consistency of applications. During the research acceptable benchmarks for the calculation or quantification of the elements linked to materiality and audit risk were found. The benchmarks are in compliance with the practices and the requirements of the ISAs and regulations. Models and benchmarks based on literature were used as a basis and modified for application in the auditing environment. The combination of literature, responses from public practitioners and experience based on best practices resulted in the development of a modified risk-based assessment model. The conclusion from the empirical study indicated that there are no defined rules or basis for calculating materiality and audit risk. The inconsistencies in responses indicate that audit firms and developer of key concepts interpret and apply the above-mentioned term different in practice. The interpretations of the relevant ISAs, appear to be conceptually correct as no major non-compliances were identified. Various instances indicated that there is a lack of guidance with regard to the quantification or qualification of benchmarks. The implementation of the Sarbanes-Oxley Act (2002) was an event that leads to the consideration of more conservative benchmarks. The most consistent benchmark that stood the test of time was Discussion paper 6 (1984). The 30 years since the development of these benchmarks indicate that little attention has been given to one of the most complex issues in auditing. Companies within different industries are not generic and exceptions will occur where the auditor needs to apply professional judgment to accommodate the deviations. Further research is required to assist the audit professionals and students in the development of consistent benchmarks to increase the reputation of the profession. The conclusion drawn from this study is that audit materiality and audit risk has a significant impact on the audit process as even the audit report is influenced by proper audit planning and guidelines to support the auditor in audits. / MCom (Accountancy), North-West University, Vaal Triangle Campus, 2013

Changes in understanding the role of internal audit and the changing needs of executive managers leads to the more frequent use of internal auditors as independent consultants. The aim of this diploma paper is to acquaint the reader with a wide range of activities and principles of the internal audit work of internal auditors. The second part deals with process optimization which has recently become ever more important concern of the work of internal auditors. The practical part demonstrates an example of the analysis and optimizing processes and corporate's management. This analysis is based on the real process audit and process optimization.

On all Swedish audits on fiscal years starting 1st of January 2011 or later, the clarified ISAs should be applied. Before that, the Swedish auditing standards were called RS, which were a direct translation of the elder version of the ISAs but with considerations of Swedish law and Swedish traditions. The EC states that there will be no fundamental changes for the Swedish audits when the clarified ISAs is implemented, and IFAC states that all audits will realize significant changes when the clarified ISAs is implemented. The purpose of this study is therefore to explain how the audit process has been affected by the implementation of the clarified ISAs and what effects it has given rise to. The study also aims at explaining the relationship between audit firm size and impact on the audit process. This study was conducted using qualitative methods for both collecting and analyzing data. The data have been collected using both primary and secondary data. The primary data was collected through questionnaires in order to get as many opinions as possible but interviews were conducted as well in order to get a deep insight about the subject and to make sure that the questions in the questionnaire was relevant. What emerged in this study is that both the EC and IFAC were right about the implementation of the clarified ISAs in Sweden. The auditors that participated in this study explained that the way they are doing an audit has not changed, which means that no fundamental changes have occurred in the audits. However, the auditors have experienced some changes in the audit process, for example an increased amount of requirements on documentation and a more complicated and time consuming auditor’s report. How much the audit process has changed differs depending on the size of the audit firm. Generally, the impact on the audit process at the “big four” are less than it is on small audit firms due to the fact that many of the “big four” have worked with ISA before. Overall, the auditors have experienced that the implementation of the clarified ISAs have meant an increased cost for doing audits, in the form of updates in audit methodologies, educations and more procedures to perform. However, the auditors have not experienced that the audit quality has increased due to this. This means that the costs for an audit have increased while the quality remains the same.

This thesis focused on procedures of auditor when assure consolidated financial statements prepared in accordance with IAS/IFRS. The aim is to summarise different issues starting with preparing annual financial statements and finalising with auditorś report disclosure.

This thesis describes the integration of an organization by the process management and it is based on a hypothesis: Is it possible by using process audit to assess the maturity level of the process(es) and the maturity of the organization Mepatek holding itself? The thesis has following objectives: Firstly the research of theoretical basis for the application of appropriate methodologies for a designing process-driven organization, secondly with the help of the process audit assess the maturity process(es) and the entire organization and thirdly a proposal of process-driven organization. This thesis is divided in four parts. The first part is connected to the explanation of the topic, hypotheses definition and objectives. The second part concerns on process management which defines the basic concepts and describes the theoretical background needed to understand the issue. The third part deals with the integration of an organization Mepatek holding"by the process management. The fourth and last part contains a conclusion and evaluation of the objectives of the thesis.

Purpose: The purpose of this study is to investigate and analyze whether the relationship between structural domains represented by CAATs and judgment represented by professional scepticism is related to auditors’ individual characteristics, trait scepticism. Methodology: This study is based on a quantitative method in the form of a questionnaire sent to all Swedish authorized auditors. The response rate was 16.8 per cent. The responses were analyzed by Spearman correlation matrix, principal component analysis, multiple linear regression analysis, and hierarchical moderated multiple regression analysis. Moreover, this thesis is based on a positivistic perspective to get a general picture of professional scepticism. A deductive approach, going from theory to empirics, has been implemented. Findings: The results showed a positive relationship between judgment represented by professional scepticism and structure represented by CAATs, where auditors’ individual characteristics, trait scepticism, have a positive moderating effect on the relationship. Theoretical perspectives: We apply the profession theory, comfort theory and structure and judgment at Swedish authorized auditors with diverse experience.

The present auditing environment involves increasing audit costs and potential legal liability. Increasing audit costs mandate methods to make the audit more efficient, while the credibility of audited financial statements depends on audit effectiveness. Internal accounting control evaluation impacts both the efficiency and effectiveness of the audit process since this judgment establishes a basis for determining the timing, nature and amount of auditing procedures to be performed. Results of previous research, however, have indicated that variance does exist in auditors' evaluations of internal controls. While individual differences have been given as an explanation of the variance, no research has successfully isolated which individual differences relate to differences in judgment. This study examined the possibility that cognitive style, defined as the mode of processing which individuals use in their perceptual activities, was an individual difference which could explain some of the variance in internal control judgments. The Myers-Briggs Type Indicator (MBTI) was used to measure the cognitive style of auditors. A second instrument, an audit judgment case, was prepared by the researcher to elicit (1) an auditor's estimate of the reliability of internal controls in a computerized payroll application, and (2) his assessment of the perceived relevance of case information to his reliability judgment. Ninety auditors attending training sessions held by six Dallas CPA firms completed the MBTI and case description. These instruments were administered by the researcher during the Summer of 1984. The participants were primarily senior-level auditors with three years' experience. The statistical methods used in this study included the t-test and ANOVA. Results of the study indicated lack of consensus in the internal control reliability estimates of the participants. Differences were noted in the information the sensing and intuitive types identified as important to their reliability estimates. The number of cues identified as important by the participants was not significantly related to their perceptual mode (sensing or intuitive) or to their internal control reliability judgment.

Technology is advancing at a rapid pace impacting many industries including accounting and auditing industries. Technological development has enabled implementation of automated accounting systems that make it possible for firms to shift from traditional accounting to automated accounting. This change in record keeping has a direct influence on audit firms. As record keepings changes, it puts pressure on audit firms to implement systems that cater for the change in their clients’ systems. This promotes automated auditing where the use of tools such as data analytics and AI are of importance. There is prior research related to accounting system, automated accounting, automated auditing and the impact of technological development on various industries and professions. However, the impacts of automation on the audit process remain unexplored, especially in Swedish audit firms. As there is only a little literature on the subject, in spite of considerable amount of discussion inside and outside academia about how automation impacts the audit process, the subject is seen as current and interesting. Therefore, the main purpose of this research is to discover how automation impacts the audit process in Swedish audit firms. The research question for this thesis is “How does automation impact the audit process?” The audit process is seen as being closely related to audit quality, audit efficiency and competence and skills of auditors. Thus, as sub-purpose, this research also aims to find out how the mentioned aspects are impacted by automation. In this thesis a qualitative approach was taken. Semi-structured interviews were performed with various auditors in order to explore the subject in question. Empirical findings of this thesis suggest that the execution stage of an audit process will be impacted the most by automation. The shift can already be seen but in the future the emphasis will be even more on testing internal controls than substantive procedures. It was also discovered that audit quality and audit efficiency are expected to increase because automation is believed to decrease the amount of human errors and speed up the audit process as well as help auditors draw better conclusions. Competence and skills of auditors were found to be as important in the future as they are nowadays, but the findings suggest that a higher level of IT knowledge and skills are desired in the future as more technology will be integrated in auditing. This research offers theoretical, practical and social contributions. This research extends the existing knowledge on the subject in question. It also helps accounting and auditing firms to understand the impact of automation in the field as well as gives them an opportunity to prepare in advance for changes that may occur. Additionally, the findings of this research can give educational institutions an indication in which way the curriculum in universities should be adjusted. On a national level the findings can be used to encourage continuous learning.  Furthermore, this research can be used as a point of departure for future research.

Background – As we live in a more digitized world, technological advancements have already taken place and have reshaped many different industries. One of these industries is the audit profession, which is a profession where the digitalization can contribute immensely. The digitalization is an on- going process within the field of audit and have resulted in improved tools and more efficient auditing. However, new emerging risks, such as IT-risks, have progressed along the digitalization. Purpose – The purpose of this study is to explore how the digitalization affects the auditing in Sweden, and more precise, how it affects the audit process and the risk that emerges from the digitalization. Furthermore, the study will examine if there are any perceived differences among small and big audit firms in the concept of digitalization. Method – The Delphi method has been used to gather the primary data needed for the study. Practitioners from both the Big 4-firms and the smaller firms have been selected to take part of the study as experts by participating in a brainstorming session and by answering a questionnaire. This classification of the firms will be the two panels of experts within the study. Conclusion – The results indicates that the perception of digitalization of the audit process and the audit risks within the Big 4-firms and the smaller firms are somewhat alike but not ultimately. The two panels agree that the effects of the digitalization have been substantial and that the auditing in the future will be even more efficient. Regarding the risks the panels have more differentiated opinions, where the second panel, consisting of the smaller firms, believes that the digitalization has affected the risks to a larger extent than the first panel. As this thesis aimed to investigate, there is indeed a perceived difference among the Big 4-firms and the smaller firms regarding the digitalization effect on the audit process, although not a substantial one.