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Article
An Examination of Underreporting of Time and Premature Signoffs by Internal Auditors
Review of Business Information Systems
  • Qianhua Ling, Marquette University
  • Michael D. Akers, Marquette University
Document Type
Article
Publication Date
1-1-2010
Publisher
The Clute Institute
Disciplines
Abstract
The passage of the Sarbanes-Oxley Act of 2002 (SOX) heightened the importance of internal controls and accordingly, a key control - the internal audit junction. Consequently, management and external auditors have both increased their reliance on internal auditors' work. While there has been considerable research regarding the impact of the underreporting of time and premature sign-offs on the external audit, there has only been one study that has examined the impact of these two items on the internal auditors' work. Such research is dated (1994) and prior to the passage of SOX. We surveyed members of the Institute of Internal Auditors (IIA) in the Midwest to examine their behavior and perceptions regarding these two items. The respondents in our study believe the underreporting of time is unethical and is supported by their reporting of all time worked, even if such time exceeded the budget. Our findings also show that the respondents feel premature sign-offs are unethical and result primarily from lack of professional skepticism and inadequate training. Increasing training in audit areas and improving communications within the audit team are possible solutions to reduce premature sign-offs. Premature sign-offs are more likely to occur in operational audits and to a lesser degree in financial audits and compliance audits.
Comments

Published version. Review of Business Information Systems, Vol. 14, No. 4 (Fourth Quarter 2010): 37-48. DOI. © 2010 The Clute Institute. Used with permission.

Creative Commons License
Creative Commons Attribution 3.0
Citation Information
Qianhua Ling and Michael D. Akers. "An Examination of Underreporting of Time and Premature Signoffs by Internal Auditors" Review of Business Information Systems (2010) ISSN: 1534-665X
Available at: http://works.bepress.com/michael_akers/11/