Audit quality measurement model using factor analysis technique, structural equations and decision trees C5.0-C & R

Document Type : Original Article

Authors
payam khodaei esameilkandi 1
peyman amini 2
ataallah mohamadi molqarani 3
1 Department of Accounting, islamic azad university, sanandaj baranch, sanandaj, iran
2 Assistant professor, Faculty of Literature and Social Sciences- Department of Accounting, University of Kurdistan, Kurdistan, Iran
3 Faculty of Accounting and Political Sciences, Islamic Azad university, Sanandaj Branch, Sanandaj, Iran
Abstract
The quality of audit institutions is always one of the most important things in auditing. Researchers in this field believe that the most effective variable in the discussion of audit quality is audit institutions .The purpose of this study is to present a new method for predicting and ranking the quality of audit institutions affiliated to Iranian Institute of Certified Public Accountants (IACPA). and its innovation is to achieve a highly accurate forecasting model. For this purpose ,we used data records of the quality control and status control of IACPA which had already been gathered through questionnaires from 2012 to 2017. We selected 1555 pieces of information records. After screening and deleting incomplete data, 1367 pieces of information were studied. Then, to reduce the data dimensions and find the internal and optimal pattern of variables set. Factor analysis and structural equation techniques were applied. The analysis revealed three categories paly ing a major role in quality of audit. These categories, constructs, were labelled process indicators , environmental or contextual indicators and input indicators. Finally, we used decision tree algorithm from data mining techniques, namely, C&R, and C5.0 algorithms. The results showed that C5.0 algorithm with 92% accuracy and sensitivity, and 97% detection power is the best performance for predicting audit quality and The C&R algorithm is able to predict the qualitative ranking of auditing institutions with 83% accuracy and sensitivity and 93% detection power
Keywords
audit institutions
Qualitative Rank
Decision Tree algorithm
Data mining
  • بهزادیان، فتاح.، ایزدی نیا، ناصر. (1397).بررسی عوامل مؤثر بر کیفیت حسابرسی از دیدگاه حسابرسان مستقل و مدیران مالی شرکت‌های پذیرفته‌شده در بورس اوراق بهادار تهران. پیشرفت‌های حسابداری، (1) 10، 60-28.
  • حساس یگانه، یحیی.، غلام‌زاده لیداری، مسعود. (1391). ارزیابی جامع کیفیت حسابرسی در ایران: فرصت‌های تحقیقاتی، دهمین همایش ملی حسابداری ایران، تهران، دانشگاه الزهراء.
  • خدایی اسمعیل کندی ،پیام، امینی ، پیمان ، محمدی ملقرنی ،عطاالله ، فاطمی ،عادل.(1398). به‌کارگیری الگوریتم‌های درخت تصمیم‌گیری در پیش‌بینی کیفیت حسابرسی .دانش حسابداری و حسابرسی مدیریت، سال هشتم ،شماره 32 .224-209
  • خوش‌رو، امید. (1396). ارائه مدلی برای کیفیت حسابرسی با استفاده از شبکه عصبی مصنوعی. پایان‌نامه دکتری حسابداری، دانشگاه تهران، پردیس علوم اجتماعی و رفتاری .
  • دوانی، غلامحسین. (1382). رتبه‌بندی مؤسسات حسابرسی. حسابدار سال بیست و یکم شماره صد و هفتادوپنج
  • رؤیایی، رمضان علی.، طالب نیا، قدرت اله.، حساس یگانه، یحیی.، صابر، جلیلی (1392).بررسی رابطه بین فلسفه اخلاق فردی و ویژگی‌های جمعیت شناختی با رفتارهای کاهنده کیفیت حسابرسی"، حسابداری مدیریت، دوره(16) 6، 26-15
  • صالحی، مهدی.، فرضی­پیله­رود، لاله (1397). "پیش‌بینی مدیریت سود با استفاده از شبکه عصبی درخت تصمیم" پژوهش‌های حسابداری مالی و حسابرسی . 10(37). 24-1
  • علوی طبری، سید حسین.، پارسایی، رضا (1398). "رابطه کیفیت حسابرسی با شفافیت شرکتی در شرکت‌های پذیرفته‌شده در بورس اوراق بهادار تهران"، پژوهش‌های حسابداری مالی و حسابرسی،11(41) 41 68-43
  • مجتهدی زاده، ویدا.، آقایی، پروین (1383). عوامل مؤثر بر کیفیت حسابرسی از دیدگاه حسابرسان مستقل و استفاده‌کنندگان، بررسی‌های حسابداری و حسابرسی، 11(38). 76-53
  • محمدرضایی، فخرالدین.، یعقوب نژاد، احمد (1396). اندازه موسسه حسابرسی و کیفیت حسابرسی نقد نظری نقد روش پژوهش و ارائه پیشنهاد‌ها . پژوهش‌های حسابداری مالی و حسابرسی (34)9. 60-31.
  • مشایخی، بیتا.، مهرانی، کاوه.، رحمانی، علی.، مداحی، آزاده (1392). تدوین مدل کیفیت حسابرسی. فصل‌نامه بورس اوراق بهادار ، (23)6 103-137
  • مغنی زاده ترشیزی مقدس اردبیلی، نجمه.، آتشی گلستانی، حجت اله (1395). رتبه‌بندی مؤسسات حسابرسی و اثرات آن. دومین همایش ملی مدیریت و حسابرسی
  • نیکبخت، محمدرضا.، محمودی­خوشرو، امید (1396). بررسی عوامل مؤثر بر کیفیت حسابرسی در ایران با توجه به شاخص‌های هیئت نظارت بر حسابداری شرکت‌های سهامی عام (PCAOB)"، بررسی‌های حسابداری و حسابرسی، (24)3 462-441.
  • Ahmed A. Sarhana,c, Collins G. Ntimb, Basil Al-Najjaraa, (2019), Antecedents of audit quality in MENA countries: The effect of firm- and country-level governance quality Journal of International Accounting, Auditing and Taxation 35 (2019) 85–107.
  • Alavi Tabari, Seyed Hossein, Parsaie, Reza (2019), "Relationship between Audit Quality and Corporate Transparency in Companies Admitted in the Tehran Stock Exchange", Financial Accounting and Auditing Researches, 11 (41) 43-68
  • Bahaaeddin Ahmed Alareeni, (2019) "The associations between audit firm attributes and audit quality-specific indicators: A meta-analysis", Managerial Auditing Journal, https://doi.org/10.1108/MAJ-05-2017-1559
  • Behzadian, Fattah, Izadinia, Nasser (2018), "Investigating the Factors Affecting the Audit Quality from the Perspective of Independent Auditors and Financial Managers of Companies Admitted in the Tehran Stock Exchange", Accounting Advancements, (1) 10, 28-60
  • Davani, Gholam Hossein (2003), "Ranking Audit Firms", Hesabdar, Vol. 21, No. 175
  • GonthierBesacier, N., Hottegindre, G., & FineFalcy, S. (2016). Audit quality perception: Beyond the ‘RolePerception Gap’. International Journal of Auditing, 20(2), 186-201.
  • Hasas Yeganeh, Yahya, Gholamzadeh Lodari, Massoud (2012), "Comprehensive Evaluation of Audit Quality in Iran", Research Opportunities, 10th National Conference on Iranian Accounting, Tehran, Alzahra University
  • Hillary A. Cuestaa, Donna L. Coffmana, Charles Branasb, Heather M. Murphya, (2019),Using decision trees to understand the influence of individual- and neighborhood-level factors on urban diabetes and asthma,Health & Place 58,102119
  • Khoshroo, Omid, (2017), "Presenting a Model for Audit Quality Using an Artificial Neural Network", Ph.D. Thesis in Accounting, University of Tehran, Campus of Social and Behavioral Sciences
  • Knechel, W. R, Krishnan, G. V., Pevzner, M., Shefchik, L. B., & Velury, U. (2012). Audit quality: Insights from the academic literature. Auditing: A Journal of Practice & Theory, 32(1), 385–421
  • Laitinen E K., Laitinen T. (2015). A probability tree model of audit quality.European Journal of Operational Research. 243. 665–677.
  • Mashayekhi, Bita, Mehrani, Kaveh, Rahmani, Ali, Madahi, Azadeh (2013), "Compiling an Audit Quality Model", Quarterly Journal of Stock Exchange, (23) 6, 103-137
  • Moghanizadeh Torshizi Moghaddas Ardabili, Najmeh, Atashi Golestani, Hojjatollah (2016), "Ranking Audit Firms and Its Effects", Second National Conference on Management and Auditing
  • Mohammad Rezaei, Fakhreddin, Mohammad Rezaei, Mehdi (2015), "Investigating the Relationship between Ranking Trusted Audit Firms of the Stock Exchange and Audit Quality", Accounting Knowledge and Auditing Management, 4 (14), 1-14
  • Mohammad Rezaei, Fakhreddin, Yaghoub Nejad, Ahmad (2017), "The Size of Audit Firm and the Quality of the Audit; Theoretical Critique; Critique of the Research Method and the Presentation of Suggestions", Financial Accounting and Auditing Researches (34) 9, 31-60
  • Mojtahedizadeh, Vida, Aghaei, Parvin (2014), "Factors Affecting Audit Quality from the Perspective of Independent Auditors and Users", Accounting and Auditing Investigations, 11 (38), 53-76
  • Nikbakht, Mohammad Reza, Mahmoudi, Khoshrou, Omid (2017), "Investigating Factors Affecting Audit Quality in Iran According to the Indicators of Public Company Accounting Oversight Board (PCAOB)", Accounting and Auditing Investigations, (24) 3, 441-462
  • PANG, Su-lin; GONG, Ji-zhang. C5.0classification algorithm and application on individual credit evaluation of banks. Systems Engineering-Theory & Practice, (2009), 29.12: 94-4.‏
  • Roger D. Martin, Audit Quality Indicators: Audit Practice Meets Audit Research, Current Issues in Auditing, Volume 7, Issue 2,)2013(, Pages A17–A23
  • Royaie, Ramezan Ali, Talebnia, Ghodratollah, Hasas Yeganeh, Yahya, Saber, Jalili (2013), "Investigating the Relationship between the Philosophy of Individual Ethics and Demographic Characteristics with Behaviors Reducing Audit Quality", Management Accounting, Vol. (16) 6, 15-26
  • Salehi, Mehdi, Farzi Pilehroud, Laleh (2018), "Predicting Profit Management Using a Decision Tree Neural Network" Financial Accounting and Auditing Researches, 10 (37), 1-24
  • Salem Alhababsah, (2019), Ownership structure and audit quality: An empirical analysisconsidering ownership types in Jordan, Coventry Business School, Gosford St., Coventry, CV1 5DL, UK, Journal of International Accounting, Auditing and Taxation 35 (2019) 71–84
  • Xiao, T., et al. How audit effort affects audit quality: An audit process and audit output perspective. China Journal of Accounting Research (2020), https://doi.org/10.1016/j.cjar.2020.02.002