Open Access

Challenges Faced By Auditors When Estimating Fair Values. An Experiment in an Emerging Economy


Cite

Abernathy, J., Hackenbrack, K.E., Joe, J.R., Pevzner, M., Wu, Y-J. (2015) Comments of the Auditing Standards Committee of the Auditing Section of the American Accounting Association on PCAOB Staff Consultation Paper, Auditing accounting estimates and fair value measurements, Current Issues in Auditing, C1-C11.10.2308/ciia-51013 Search in Google Scholar

Barth M.E., Clinch G. (1999) Revalued financial, tangible and intangible assets: associations with share prices and non-market-based value estimates, Journal of Accounting Research, 36(Suppl. 1998), 199–232. Search in Google Scholar

Beneish, M.D., Press, E., Vargus, M.E. (2012) Insider trading and earnings management in distressed firms, Contemporary Accounting Research, 29(1), 191–220.10.1111/j.1911-3846.2011.01084.x Search in Google Scholar

Bolivar M.P.R., Galera A.N. (2012) The role of fair value accounting in promoting government accountability, ABACUS, 48(3), 348-386.10.1111/j.1467-6281.2011.00352.x Search in Google Scholar

Bratten, B., Gaynor, L.M., McDaniel, L., Montague, N.R., Sierra, G.E. (2013) The audit of fair values and other estimates: the effects of underlying environmental, task, and auditor specific factors, Auditing: A Journal of Practice and Theory, 32(1), 7–44.10.2308/ajpt-50316 Search in Google Scholar

Brink A.G., Tang F., Yang L. (2016) The impact of estimate source and social pressure on auditor’s fair value estimate choices, Behavioral Research in Accounting, 28(2), 29-40.10.2308/bria-51457 Search in Google Scholar

Brown-Liburd H., Mason S., Shelton S. (2014) The effect of reliance on third-party specialists under varying levels of internal control effectiveness on the audit of fair value measurements, Working paper, DePaul University and Rutgers, The State University of New Jersey. Search in Google Scholar

Cannon N.H., Bedard J.C. (2017) Auditing challenging fair value measurements: evidence from the field, Accounting Review, 94(4), 81-114.10.2308/accr-51569 Search in Google Scholar

Christensen, B.E., Glover, S.M., Wood, D.A. (2012) Extreme Estimation Uncertainty in Fair Value Estimates: implications for audit assurance, Auditing: A Journal of Practice and Theory, 31(1), 127–146.10.2308/ajpt-10191 Search in Google Scholar

Deloitte (2010) Springing forward: the eight annual fair value pricing survey, Retrieved April 4, 2018, from https://www.mfdf.org/images/DirResPDFs/Fair_Value_Survey.pdf. Search in Google Scholar

Deloitte (2017) PCAOB issues proposals to enhance and strengthen requirements for auditing accounting estimates, including fair value, and to address the auditors’ use of the work of specialists, Retrieved September 9, 2018 from https://dart.deloitte.com/USDART/resource/af247b55-5032-11e7-883dd924efc3f5af. Search in Google Scholar

Doliya P., Singh J.P. (2016) An interpretive structural modelling approach to analyze the interaction between factors of the fair value measurement audit process, Journal of Emerging Technologies in Accounting, 13(2), 37-48.10.2308/jeta-51477 Search in Google Scholar

Earley C.E., Hoffman V.B., Joe J.R. (2008) Reducing management’s influence on auditors’ judgments: an experimental investigation of SOX 404 assessments, Accounting Review, 83(6), 1461-1485.10.2308/accr.2008.83.6.1461 Search in Google Scholar

Ettredge M.L., Xu Y., Yi H.S. (2014) Fair value measurement and audit fees: evidence from banking industry, Auditing: a Journal of Practice and Theory, 33(3), 33-58.10.2308/ajpt-50701 Search in Google Scholar

Glover, S. M., Taylor, M., Wu, Y. (2014) The gap between auditing experts’ performance and regulatory expectations when auditing complex and fair value measurement: causes and potential solutions, Retrieved July 1, 2018 from http://www.audsymp.dept.ku.edu/wp-content/uploads/2014/05/Saturday-Paper-6-by-Glover-Taylor-Wu.pdf.10.2139/ssrn.2504521 Search in Google Scholar

Glover, S.M., Taylor, M.H., Wu YJ., (2017) Current practices and challenges in auditing fair value measurement and complex estimates: implications for auditing standards and the academy, Auditing: A Journal of Practice and Theory, 36(1), 63-84. Search in Google Scholar

Goncharov I., Riedl E.J., Sellhorn T. (2014) Fair value and audit fees. Review of Accounting Studies, 19, 210-241. https://doi.org/10.1007/s11142-013-9248-5.10.1007/s11142-013-9248-5 Search in Google Scholar

Griffin, J.B., (2014) The effects of uncertainty and disclosure on auditors’ fair value materiality decisions, Journal of Accounting Research, 52(5), 65-93. Search in Google Scholar

International Auditing and Assurance Standards Board (IAASB) (2017) International Standard on Auditing, Proposed international standard on auditing 540 (Revised), Retrieved September 3, 2018 from http://www.ifac.org/system/files/publications/files/Proposed-ISA-540-Revised-Auditing-Accounting-Estimates-and-Related-Disclosures.pdf. Search in Google Scholar

International Auditing and Assurance Standards Board (IAASB) (2018) International Standard on Auditing 540 Revised, Retrieved April 22, 2019 from https://www.ifac.org/system/files/publications/files/ISA-540-Revised-and-Conforming-Amendments_0.pdf. Search in Google Scholar

International Auditing and Assurance Standards Board (IAASB) (2018) International Accounting Standards, 500, Retrieved August 20, 2018 from https://www.iaasb.org/clarity-center/clarified-standards. Search in Google Scholar

Joe J.R., Vandervelde S.D., Wu Y.J. (2017) Use of high quantification evidence in fair value audits: do auditors stay in their comfort zone?, Accounting Review, 92(5), 89-116.10.2308/accr-51662 Search in Google Scholar

King A.M. (2006) Auditing evaluation reports, Valuation Strategies, 9(6), 18-25.10.5791/0882-2875-25.1.18 Search in Google Scholar

Martin, R.D., Rich J.S., Wilks T J. (2006) Auditing fair value measurement: a synthesis of relevant research, Accounting Horizons, 20(3), 287–303.10.2308/acch.2006.20.3.287 Search in Google Scholar

Mora A., McGeachin A., Barth M.E., Barker R., Wagenhofer A., Joos P. (2019) Fair Value Accounting: The Eternal Debate – AinE EAA, Symposium, May 2018, Accounting in Europe, 3-19.10.1080/17449480.2019.1664754 Search in Google Scholar

Menelaides S.L., Graham L.E., Fischbach G. (2003) The auditor’s approach to fair value, Journal of Accountancy, 195(6), 73-76. Search in Google Scholar

Muller K.A., Riedl E.J. (2002) External monitoring of property appraisal estimates and information asymmetry, Journal of Accounting Research, 40(3), 865-881.10.1111/1475-679X.00074 Search in Google Scholar

Public Company Accounting Oversight Board (PCAOB) (2011) Report on 2010 Inspection of KPMG, Retrieved September 2, 2018 from https://pcaobus.org/Inspections/Reports/Documents/2011_KPMG_LLP_US.pdf. Search in Google Scholar

Public Company Accounting Oversight Board (PCAOB) (2014) Auditing Accounting Estimates and Fair Value Measurements, Staff Consultation Paper. Retrieved August 21, 2018 from http://pcaobus.org/Standards/Pages/SCP_Accounting_Estimates_Fair_Value.aspx. Search in Google Scholar

Public Company Accounting Oversight Board (PCAOB) (2017) Auditing Accounting Estimates and Fair Value Measurements, Staff Consultation Paper. Retrieved September 3, 2018 from https://pcaobus.org/Standards/Documents/SCP_Auditing_Accounting_Estimates_Fair_Value_Measurements.pdf. Search in Google Scholar

Salzsieder L. (2016) Fair value opinion shopping, Behavioral Research in Accounting, 28(1), 57-66.10.2308/bria-51238 Search in Google Scholar

Securities and Exchange Commission SEC (2011) Disclosure and corporate governance: financial reporting challenges for 2012, Retrieved September 2, 2018 from https://www.weil.com/~/media/files/pdfs/weil_alert_sec_cg_january_12.pdf. Search in Google Scholar

Sellhorn T., Stier C. (2018) Fair value measurement for long-lived operating assets: research evidence, European Accounting Review, 1-31.10.2139/ssrn.2991997 Search in Google Scholar

Standarde de Evaluare a Bunurilor [Assets Valuation Standards](SEV) (2018) ANEVAR, Retrieved September 2, 2018 from http://site2.anevar.ro/sites/default/files/page-files/standarde_2018.compressed.pdf Search in Google Scholar

Zack M., McKeen J., Singh S. (2009) Knowledge management and organizational performance: an exploratory analysis, Journal of Knowledge Management, 13(6), 392-409.10.1108/13673270910997088 Search in Google Scholar

Zang, A. (2012) Evidence on the trade-off between real activities manipulation and accrual-based earnings management, Accounting Review, 87(2), 675–703.10.2308/accr-10196 Search in Google Scholar