The Practical Factors of Blockchain Technology in Improving Audit Quality with an Interpretive Structural Approach

Document Type : Original Article

Authors
Saeedeh Khanjani Kakrodi 1
Arezoo Khosravani 2
Naghi Fazeli 2
1 PhD student of accounting department, Semnan branch, Islamic Azad University, Semnan, Iran
2 Assistant Professor of Accounting Department, Semnan Branch, Islamic Azad University, Semnan, Iran
10.22034/jmaak.2025.23868
Abstract
The main goal of the current research is to investigate the practical factors of blockchain technology in improving audit quality with an interpretive structural approach. In terms of time, this research was done during 1402. In order to collect the required information, 15 independent auditors of accredited auditing institutions of the Stock Exchange and Securities Organization and companies admitted to the Tehran Stock Exchange were interviewed as experts. In this research, using Interpretive Structural Modeling (ISM), the role of blockchain technology in increasing audit quality was explained. The results showed 15 effective factors of blockchain technology, including high transparency of information, high security of transactions, high accuracy, high speed, decentralization, automatic processing of information, easy tracking of information and transactions, the possibility of multilateral accounting, elimination of traditional auditing methods, facilitating safe online transactions, creating Smart contracts, full implementation of the governance mechanism, limiting embezzlement and opportunistic behavior, spending less time and money on audits lead to an increase in audit quality. The component of increasing the quality of auditing based on blockchain technology, which is located at the first level of the ISM graph, is the most effective and dependent component of the model.
Keywords
Audit Quality
Blockchain Technology
Interpretative Structure
  1. اسماعیلی کیا، غریبه. (1398). فناوری بلاک‌چین و کاربردهای آن در حسابداری و حسابرسی بخش عمومی. هفدهمین همایش ملی حسابداری ایران، قم.
  2. توتچی فتیدهی، مهتاب؛ حسینی، سیده عاطفه؛ میرشاه ولایتی، فرزانه؛ مهدیزاده اشرفی، علی و جدیدی اول، کمال. (1401). بررسی عوامل موثر کارآیی فناوری بلاکچین در حرفه حسابرسی با روش فراترکیب (متاسنتز). دانش حسابداری و حسابرسی مدیریت، 11(43)، 113-126.
  3. ثقفی علی ، جمالیان پور مظفر، (1397)، بلاکچین و آینده ی حسابداری و حسابرسی، ماهنامه حسابدار.
  4. حساس یگانه، یحیی و نادری نوعینی، محمد مهدی. (1386). درس هایی از فروپاشی انرون در زمینه حاکمیت شرکتی. حسابدار، شماره 192و193، ص 53-61.
  5. زارع بهنمیری، محمد جواد؛ ملکی، محمد حسن؛حسنخانی، فاطمه و رامشه، منیژه. (1402). ارائه چارچوبی برای شناسایی و تحلیل پیشران‌های کلیدی اثرگذار روی آینده حسابرسی در ایران با تمرکز بر فناوری بلاک‌چین. پژوهش های تجربی حسابداری، doi: 10.22051/jera.2023.41640.3047.
  6.  طالب نیا، قدرت اله و نوری دوآبی، پیام. (1402). تأثیرات فناوری بلاک چین بر حرفه حسابداری و حسابرسی.
  7. محمدی نوره، شاکر، رحیمیان، نظام الدین، احمدی دهرشید، جمیل. (1400). بررسی تأثیر دیجیتالی شدن بر حسابرسان مستقل و مؤسسات حسابرسی در ایران. پژوهش‌های حسابرسی، 3، 153-181.
  8. Alles, M.G. (2015) Drivers of the Use and Facilitators and Obstacles of the Evolution of Big Data by the Audit Profession, Accounting Horizons, 29(2), 439-449, https://doi. org/10.2308/acch-51067.
  9. Antipova, T. (2018). Using Blockchain Technology for Government Auditing. Presented at the 13th Iberian Conference on Information Systems and Technologies (CISTI).
  10. Appelbaum, D., Kogan, A. and Vasarhelyi, M.A. (2017). Big Data and Analytics in the Modern Audit Engagement: Research Needs, Auditing: A Journal of Practice & Theory, 36(4), 1-27.
  11. Arnaboldi, M, Busco, C. and Cuganesan, S. (2017). Accounting, accountability, social media and big data: revolution or hype? Audit. Account. J, 30 (4), 762–776.
  12. Ashbaugh, H., Warfield, T.D., (2003). Audits as a corporate governance mechanism: evidence from the German market. Int. Account. Res. 2, 1–21.
  13. Bejjar, M.A., and Siala, Y. (2024). The Impact of Blockchain Technology on the Financial Audit. In Impact of Digitalization on Reporting, Tax Avoidance, Accounting, and Green Finance (pp. 272-300). IGI Global.
  14. Beisland, L.A, Mersland, R. and Strom, R.O. (2015). Audit quality and corporate governance: evidence from the microfinance industry. J. Audit. 19 (3), 218–237.
  15. Brown-Liburd, H., Issa, H. and Lombardi, D. (2015). Behavioral implications of big data's impact on audit judgment and decision making and future research Account. Horiz, 29 (2), 451–468.
  16. Cao, M., Chychyla, R. and Stewart, T. (2015). Big Data analytics in financial statement audits. Horiz, 29 (2), 423–429.
  17. Dai, J. and Vasarhelyi, M.A. (2017). Toward Blockchain-Based Accounting and Assurance, Journal of Information Systems, 31(3), 5-21.
  18. Dengler, K.B. (2018). The impacts of digital transformation on the labour market: substitution potentials of occupations in Germany. Forecast. Soc. Change, 137, 304–316.
  19.  
  20. Dua, W.D., Panb, S.L., Leidnerc, D.E., and Yinga, W. (2019). Affordances, Experimentation and Actualization Of Fintech: A Blockchain Implementation Study. Journal of Strategic Information Systems, 28(1): 50-65.
  21. Francis, J.R., Maydew, E.L., Sparks, H.C., (1999). The role of Big 6 auditors in the credible reporting of accruals. Auditing 18 (2), 17–34.
  22. Francis, J.R. and Carcello Wang, D. (2008). The joint effect of investor protection and Big 4 audits on earnings quality around the world. Account. Res, 25 (1), 157–191.
  23. Hope, O.‐K. Kang, T., Thomas, W. and Yoo, Y.K. (2008). Culture and auditor choice: a test of the secrecy hypothesis.
  24. Kozlowski, S. (2018). An Audit Ecosystem to Support Blockchain-based Accounting and Assurance. Continuous Auditing, 299–313.
  25. Kuang, H., Li, H., Sherwood, M.G. and Whited, R.L. (2020) Mandatory Audit Partner Rotations and Audit Quality in the United States. AUDITING: A Journal of Practice & Theory, In-Press.
  26. Le, T.T., Anh Nguyen, T.M., Do, V.Q. and Ngo, T.H.C. (2022). Risk-based approach and quality of independent audit using structure equation modeling − Evidence from Vietnam. European research on management and business economics, 28, 1-11.
  27. Leuz, C., Lins, K.V., Warnock, F.E., (2009). Do foreigners invest less in poorly governed firams? Financ. Stud. 22 (8), 3245–3285.
  28. Liu, M., Wu, K., and Xu, J.J. (2019). How Will Blockchain Technology Impact Auditing and Accounting: Permissionless versus Permissioned Blockchain. Current Issues in Auditing, 13(2), A19-A29
  29. Montes, G.A. and Goertzel, B. (2018). Distributed, decentralized, and democratized artificial intelligence. Technol. Forecast. Soc. Change. https://doi.org/10.1016/j.techfore. 2018.11.010.
  30. Mori, D.D. and Ricci, L.P. (2019), A blockchain based approach for the definition of auditable Access Control systems,https://doi.org/10.1016/j.cose.2019.03.016Get rights and content. Vol. 84, P P. 93-119.
  31. Rao, J. and Weintraub, J. (2013). How innovative is your company culture? MIT Sloan Manage. Rev, 54 (3), 29–37.
  32. Richins, G., Stapleton, A., Stratopoulos, T.C., Wong, C. (2017). Big data analytics: opportunity or threat for the accounting profession? Inf. Syst. 31 (3), 63–79.
  33. Rückeshäuser, N. (2017). Do We Really Want Blockchain-Based Accounting? Decentralized Consensus as Enabler of Management Override of Internal Controls. In 13. Internationalen Tagung Wirtschaftsinformatik (pp. 16–30). St. Gallen, Switzerland.
  34. Sahut, JM., Hikkeorva, L. and Moez, K. (2013). Business model and performance of firms. Bus. Res. 6 (2), 64–76.
  35. Van Den Broek, T. and Van Veenstra, A.F. (2018). Governance of Big Data collaborations: how to balance regulatory compliance and disruptive innovation. Technol. Soc. Change, 129, 330–338.
  36. Vasarhelyi, M.A., Kogan, A. and Tuttle, B.M. (2015). Big Data in accounting: an overview. Horiz, 29 (2), 381–396.
  37. Wang, J. (2023). Research on the construction of accounting information audit quality control system based on blockchain. Security and Privacy, 6(2), e227.
  38. Warren, D., Moffitt, K. and Byrnes, P. (2015). How accounting records will change with Big Data. Horiz, 29 (2), 397–407.
  39. Yang, D., Jiao, H. and Buckland, R. (2017). The determinants of financial fraud in Chinese firms: does corporate governance as an institutional innovation matter?. Forecast. Soc. Change 125, 309–320.