Gilchrist, David, Agrawal, Prerana, Das, Abhijit, and Wen, Han (2022) Audit Research in Australian Charitable Organisations: A Review of Literature. In: [Presented at the 15th Biennial Australian and New Zealand Third Sector Research Conference]. From: 15th Biennial Australian and New Zealand Third Sector Research Conference: The Voice and Contribution of the Third Sector in Australia and New Zealand: Contemporary Achievements and Challenges in Creating Public Good, 17-19 November 2022, Perth, WA, Austraia.

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Abstract

In the last 5 years, discussions on research opportunities in the audit service area for the large, medium, and small Australian charitable organisations have garnered a lot of interest among academics, practitioners, standard-setters, and regulators in Australia. Principally, this has been the result of increased focus on accounting standards and reporting concerning to charitable organisations. However, up until recently, research in the audit of charitable organisations is still in the stage of infancy and therefore, the development of a research program is crucial to narrow the knowledge gap.

In this paper, we review prior literature that investigates auditing-related issues for the not-for-profit sector (i.e., charitable and other types of not-for-profit organisations). We classify extant auditing literature in two broad categories: (1) effectiveness of governance in financial reporting quality in not-for-profit organisations and (2) audit quality in not-for-profit organisations. We will use this categorisation to assess the cumulative knowledge generated in the past 5 years, as well as to identify knowledge gaps and opportunities for future research. Based on the literature review, we aim to develop exemplars of audit research mainly for medium and large Australian charitable organisations with a view of the terrain over which research can be progressed, in particular, we aim to address the following research questions:

Category 1: Effectiveness of Governance in Financial Reporting Quality in not-for-profit organisations (i) To what extent governance mechanisms (e.g., audit committee, internal audit) are effective in producing quality financial reports in large Australian charities? (ii) How are audit committees of charities in Australia related to each other? What is the issue if they are related?

Category 2: Audit Quality in non-for-profit organisations (iii) Are audit-related factors (e.g., auditor size, auditor specialisation, auditor tenure and audit fees) associated with audit quality in large and medium charities in Australia? (iv) Is there any evidence of earnings management in large and medium charities in Australia? (v) Do sophisticated donors discount accounting information more than mum-dad donors if audited by “Non-Big 4” auditors rather than “Big 4” auditors? (vi) Is there any difference in audit quality between pro-bono, low pro-bono and non-pro-bono audits of large and medium charities in Australia?

Item ID:	79648
Item Type:	Conference Item (Abstract / Summary)
Keywords:	Charitable organisation, Audit
Related URLs:	https://www.anztsr.org.au/
Date Deposited:	07 Aug 2023 23:29
FoR Codes:	35 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 3501 Accounting, auditing and accountability > 350102 Auditing and accountability @ 50% 35 COMMERCE, MANAGEMENT, TOURISM AND SERVICES > 3501 Accounting, auditing and accountability > 350106 Not-for-profit accounting and accountability @ 50%
SEO Codes:	28 EXPANDING KNOWLEDGE > 2801 Expanding knowledge > 280106 Expanding knowledge in commerce, management, tourism and services @ 100%
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