Relationships among audit ethics, audit morality and audit quality of certified public accountants (CPAs) in Thailand.

Author:Ussahawanitchakit, Phapruke
Position:Report
 
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  1. INTRODUCTION

    Nowadays, auditors have attempted to perform the best audit practices by concerning with auditing standards, regulations and rules in order to gain audit quality, audit efficiency, audit effectiveness, audit survival, and audit sustainability in the professional work environments. They have explicitly been aware of audit ethics, audit morality and audit professionalism in performing the audit duties, audit activities and audit functions. Here, audit ethics and audit morality become important concepts that encourage auditors to provide professional audit works and achieve audit quality and audit success. Audit ethics is an ethical behavior through integrity, credibility, fairness, dialogue, transparency, dignity, legality, civic commitment, environment, and responsibility in the audit works (Garcia-Marza, 2005). Auditors with more audit ethics are likely to take up a dialogue with major stakeholders to report on audit activities with a view to shaping future ones via compliance with audit standards, laws, regulations, and rules, and better provide systematic and reliable audit practices in making reliability and credibility in the audit works insuring audit quality and audit performance. Also, audit morality is an individual's definition of what is good or right (Thorne and Hartwick, 2001). It potentially enhances auditors to concern with their levels of moral development that affect ways which they have applied to resolve dilemmas. Then tend to implement better audit practices and present higher audit quality and audit success.

    In this study, the associations among audit ethics, audit morality and audit quality are explicitly investigated. Accordingly, audit ethics is the independent variable, audit morality is the mediating variable and audit quality is the dependent variable of the study. Firstly, audit quality is an outcome of auditors' reports of professional practices, duties, activities, and responsibilities by committing to audit standards, objectives, goals, and policies. Secondly, audit ethics is a process which measures the internal and external consistency of auditors' values base in the audit practices via intended for accountability and transparency towards stakeholders (Ionescu, 2003). Thirdly, audit morality is a self-imposed or attributable obligation to ensure that actions knowingly and intentionally performed by rational human beings in the audit works (Ostapski and Isaacs, 1992). Thus, audit ethics is hypothesized to become a key driver in determining and explaining audit quality. Audit morality is proposed to moderate the audit ethics-audit quality relationships.

    Audit ethics here plays a significant role in determining, driving and explaining audit quality. Audit morality is also hypothesized to become a mediating influence of the audit ethics-audit quality relationships. Hence, the objective of this study is to examine the effects of audit ethics on audit quality of certified public accountants (CPAs) in Thailand via audit morality as a mediator. Audit ethics is the independent variable, audit quality is the dependent variable, and audit morality is the mediating variable of the study. The key research questions are: (1) How audit ethics has a relationship with audit morality, (2) How audit ethics has an association with audit quality, (3) How audit morality has an interaction with audit quality, (4) Whether audit morality is a mediator of the aforementioned relationships, and (5) Whether the research relationships are positive.

    This study is outlined as follows. Literature review of audit ethics, audit morality and audit quality is addressed and examined; and significant research hypotheses developments are presented. Next, the research methods used to test the hypotheses are discussed including sample selection and data collection procedure, variables and methods. The results of the study derived from 113 certified public accountants (CPAs) in Thailand have indicated and the reasonable discussions with existing literature supports are shown. Lastly, the study concludes through discussing implications for theories and practices, identifying limitations of the study, and providing suggestions and directions for future research.

  2. LITERATURE REVIEW ON AUDIT ETHICS, AUDIT MORALITY, AND AUDIT QUALITY, AND HYPOTHESES DEVELOPMENTS

    The relationships among audit ethics, audit morality and audit quality are explicitly investigated. Certified public accountants (CPAs) in Thailand are the sample of the study. The conceptual, linkage, and research model of the relationships thus have been presented in Figure 1.

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    2.1 Audit Ethics

    Audit ethics is defined as a process which measures the internal and external consistency of auditors' values base in the audit practices via intended for accountability and transparency towards stakeholders (Ionescu, 2003). Besides, it enables auditors to establish clear guidelines about the limits of acceptable behaviors which are consistent world-wide. Auditors with greater...

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