An Evaluation of Implementing Revised ISA 700 in Reducing Audit Expectations Gap

Subject Areas : Management Accounting

هاشم نیکومرام ¹ (ندارد)
فریدون رهنمای رودپشتی ² (ندارد)
علی اکبر نونهال نهر ³ (ندارد)

Received: 2012-07-28 Accepted : 2012-09-05 Published : 2014-03-16

Keywords: Audit Report, Audit Expectations Gap, Revised ISA700, Audit Opinion, Auditors, Investors,

Abstract :

This research experimentally examines impact of implementing revised auditing standardrequirements No. 700 in reducing the audit expectations gap and enhancing the role andimportance of auditing. In recent years, several researches indicate the existence andcontinuity of the audit expectations gap (Gold et al, 2012). Although the auditing professionhas always had numerous efforts to reduce this gap, but it seems they were not veryuseful. The main vehicle of communication between auditors and users of accounting reportsis audit report, and therefore the efforts of the auditing profession have been through itsmodification. Last attempt of profession therefore, was to release the revised version of thestandard 700 in relation to how the audit report has been developed which appears toemphasize on the increasing of vividness degree (wording and presentations) in audit reports.Unfortunately, such activities haven not always supported by research evidences and thereforehas not been very effective. Gold et al (2012) presented evidence of absence impact ofauditing standard 700 requirements in Europe (Germany). The results of this studysuggests, firstly: that there is high audit expectations gap in Iran, and secondly: that therequirements of auditing standard 700 have little impact to reduce this gap. The audit reportbased on reporting requirements or revised ISA700 leads to increased attention drawingperformance indeed.