Audit Expectation Gap: Perspectives of Auditors and Audited Account Users

Abstract

This study empirically examined Audit Expectation Gap: Perspectives of Auditors and Audited Account Users. For the purpose of this study primary and secondary data were used. Data were sourced through the examination of vast array of relevant literature like journals, standard textbooks, magazine and questionnaires. The data collected were analyzed by the use of simple percentage and tested by using Chi-square. The analyses reveal that misunderstanding gap exist between Audited account users and Auditors. Elements of the user misunderstanding gap discovered in this study include: (i) Duties; (ii) powers and rights (iii) Appointment and dismissal (iv) level of assurance of audit report (v) independence of auditors in performance of their duties. The study concluded that expectation of the users of audited financial statements and their belief of the duties, rights, roles and responsibility of auditors are too demanding and at variance with what is actually obtainable in the statutes and laws that regulate the work of an auditor. Finally, the study recommends that Professional bodies in collaboration with auditors should organize symposia to educate the audited account users on the duties and responsibilities of an auditor, so that the performance gap can be bridged and that the users of audited accounts should familiarize themselves with the laws, statutes and standards that regulate and stipulate the duties of an auditor so as to know what to expect of the auditors in order to bridge the performance gap.

Keywords: Audit Expectation Gap, Auditors, Financial statement

International Journal of Development and Management Review (INJODEMAR) Vol. 7 June, 2012