TY - JOUR
T1 - Discussion of "internal control weaknesses and client risk management"
AU - Aiyesha, D. E.Y.
PY - 2009/1/1
Y1 - 2009/1/1
N2 - Randal Elder, Yan Zhang, Jian Zhou, and Nan Zhou (2009) study auditors' strategies to manage client risk resulting from internal control weaknesses in the first year of The Sarbanes-Oxley Act (SOX) 404 implementation. They first examine the relation between internal control weaknesses and audit fees, modified opinions, and auditor resignations, respectively, and establish that these are viable strategies to manage control risk on a stand-alone basis. They also document that that a pecking order exists among auditors' client control risk management strategies-as control risk increases, auditors are likely to respond in the order of audit fee adjustments, modified opinions, and auditor resignations. The authors' idea to look at a portfolio of decisions is an important step in the research in this area, and this approach can be generalized to similar studies. However, certain aspects of the hypothesis development and research design limit the authors' ability to adequately address their primary research objective.
AB - Randal Elder, Yan Zhang, Jian Zhou, and Nan Zhou (2009) study auditors' strategies to manage client risk resulting from internal control weaknesses in the first year of The Sarbanes-Oxley Act (SOX) 404 implementation. They first examine the relation between internal control weaknesses and audit fees, modified opinions, and auditor resignations, respectively, and establish that these are viable strategies to manage control risk on a stand-alone basis. They also document that that a pecking order exists among auditors' client control risk management strategies-as control risk increases, auditors are likely to respond in the order of audit fee adjustments, modified opinions, and auditor resignations. The authors' idea to look at a portfolio of decisions is an important step in the research in this area, and this approach can be generalized to similar studies. However, certain aspects of the hypothesis development and research design limit the authors' ability to adequately address their primary research objective.
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U2 - 10.1177/0148558x0902400404
DO - 10.1177/0148558x0902400404
M3 - Review article
AN - SCOPUS:71949099453
SN - 0148-558X
VL - 24
SP - 581
EP - 587
JO - Journal of Accounting, Auditing and Finance
JF - Journal of Accounting, Auditing and Finance
IS - 4
ER -