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Modelling audit risk

Author

Listed:
  • Skerratt, L.C.L.
  • Woodhead, A.

Abstract

A number of discrepancies have been found between the multiplicative joint risk model and the judgments of auditors in practice. The importance of this finding depends largely on the realism of the benchmark risk model used. Therefore, the objective of this paper is to extend the joint risk model to reflect more accurately the choices and circumstances faced by auditors. In addition, identifying the components of audit risk in a systematic manner is also important because it may be able to enhance audit decision processes.

Suggested Citation

  • Skerratt, L.C.L. & Woodhead, A., 1992. "Modelling audit risk," The British Accounting Review, Elsevier, vol. 24(2), pages 119-137.
    • Handle: RePEc:eee:bracre:v:24:y:1992:i:2:p:119-137
    DOI: 10.1016/S0890-8389(05)80003-4
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    References listed on IDEAS

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    1. Shibano, T, 1990. "Assessing Audit Risk From Errors And Irregularities," Journal of Accounting Research, Wiley Blackwell, vol. 28, pages 110-140.
    2. Kinney, Wr, 1975. "Decision-Theory Aspects Of Internal Control-System Design-Compliance And Substantive Tests," Journal of Accounting Research, Wiley Blackwell, vol. 13, pages 14-29.
    3. Peters, Jm, 1990. "A Cognitive Computational Model Of Risk Hypothesis Generation," Journal of Accounting Research, Wiley Blackwell, vol. 28, pages 83-103.
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