• Journal of Korean Society for Quality Management
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• v.50 no.1
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• pp.77-89
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• 2022

Purpose: In order to improve the audit quality of a company, an in-depth analysis is required to categorize the audit report in the form of a text document containing the details of the external audit. This study introduces a systematic methodology to extract keywords for each group that determines the differences between groups such as 'audit plan' and 'interim audit' using audit reports collected in the form of text documents. Methods: The first step of the proposed methodology is to preprocess the document through text mining. In the second step, the documents are classified into groups using machine learning techniques and based on this, important vocabularies that have a dominant influence on the performance of classification are extracted. In the third step, the association rules for each group's documents are found. In the last step, the final keywords for each group representing the characteristics of each group are extracted by comparing the important vocabulary for classification with the important vocabulary representing the association rules of each group. Results: This study quantitatively calculates the importance value of the vocabulary used in the audit report based on machine learning rather than the qualitative research method such as the existing literature search, expert evaluation, and Delphi technique. From the case study of this study, it was found that the extracted keywords describe the characteristics of each group well. Conclusion: This study is meaningful in that it has laid the foundation for quantitatively conducting follow-up studies related to key vocabulary in each stage of auditing.

• Journal of Korean Society for Quality Management
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• v.41 no.4
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• pp.527-539
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• 2013

Purpose: Methods for increasing health-care service quality are considered for a women-centered hospital located on a local city. A walk-through audit is applied to uncover areas for improvement. Methods: A survey questionnaire with 25 questions is constructed based on a service blueprint for a walk-through audit, and a survey is conducted both to patients and service providers to assess a health-care service quality. Frequency analysis, statistical tests and customer-provider analysis are used to analyze surveyed data. Results: According to customer-provider analysis, 6 attributes belong to 'problem unawareness' zone in which they are rated high by service providers but low by patients, and another 6 attributes belong to 'problem awareness' zone in which they are rated low by both groups. These attributes are considered to be improved with priority. Conclusion: Both patient group and service provider group have lots of different perceptions on most attributes that are examined, and the hospital to be studied is, in general, competitive in technical quality and less competitive in functional quality.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.45 no.2
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• pp.1-11
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• 2022

In this paper, we investigate the requirements of QPA(Quality Process Audit), which is a process quality audit system for secondary defense contractors, compared with those of DQMS(Defense Quality Management System). And evaluate whether the deployment of QPA meets the DQMS certification requirements through the case example of Company H. The evaluation items of QPA are composed of five categories such as Material Management, Incoming Inspection, Manufacturing Process, Product Evaluation, and Packaging Management. The QPA requirements are mainly related to the chapter 7(support) and chapter 8(operation) of DQMS standards. In this view point, QPA can be expected as an effective audit for suppliers preparing for DQMS certification. In the case example, we evaluate the results and effects of improvement due to QPA and compare it with the case of DQMS. QPA can be used as appropriate quality management standards of secondary and tertiary defense contractors and can provide the basis guidelines for the preparation of implementation steps in DQMS certification.

• Korean Management Science Review
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• v.12 no.2
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• pp.129-146
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• 1995

As society's relience on computerized information systems to support a wide range of activities proliferates, the long recognized importance for adequate data quality becomes imperative. Furthermore, current trends in information systems such as dispersal of the data resource together with its management have increased the difficulty of maintaining suitable levels of data integrity. Especially, the importance of adequate accounting (transaction) data quality has been long recognized and many procedures (extensive and often elaborate checks and controls) to prevent errors in accounting systems have been introduced and developed. Nevertheless, over time, even in the best maintained systems, deficiencies in stored data will develop. In order to maintain the accuracy and reliability of accounting data at certain level, periodic internal checks and error corrections (internal audits) are required as a part of internal control system. In this paper we develop a general data quality degradation (error accumulation ) and cost model for an account in which we have both error occurrences and error amounts and provide a closed form of optimal audit timing in terms of the number of transactions that should occur before an internal audit should be initiated. This paper also considers the cost- effectiveness of various audit types and different error prevention efforts and suggests how to select the most economical audit type and error prevention method.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.3
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• pp.833-843
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• 2021

This research examines the impact of audit quality on the extent to which firm-specific information is integrated with a firm's share price - which is determined inversely using stock price synchronicity. The study sample consists of non-financial companies listed on the Amman Stock Exchange i.e., the Jordanian Stock Market, from 2014-2018. After examining 810 firm-year observations from Jordanian industrial companies listed on the ASE, during the study period, we find that the companies using one of the BIG4 audit firms for auditing have less synchronous and more informative stock prices, suggesting high-quality audit improved governance and reduce information asymmetry between firms' insiders and investors which enhances the capitalization of firm's specific information into the stock price, thus less synchronous and more informative stock return. The findings remain consistent over 2 separate measurements of stock price synchronicity (Market and Industry model and Market Model) and show robustness for fixed effect tests. Our multivariate regression results are also robust after controlling for a number of features at the firm level with potential associations with stock price synchronicity. These include the firm size, leverage, return on assets (ROA), and market to book value (MBV).

• Journal of the Korea Society of Computer and Information
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• v.17 no.10
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• pp.203-216
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• 2012

For the successful operation of the current organization, the importance of the information system is further increasing, and audit for the information system construction is also spreading according to the mandatory of information system audit. However our country's information system audit still does not deal with various risks and the improvement plan of it is desperately needed since bad practices are often happened while performing audit for the various information system projects. Therefore, this paper proposed improved review items for the quality improvement of information system construction by analysing data of information system audit projects and risk occurrence projects that are performed by the domestic large SI company during four years. In addition, this paper verified the effectiveness of the improved review items proposed in this paper by applying them to actual information system project examples.

• The Journal of Industrial Distribution & Business
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• v.6 no.1
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• pp.37-40
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• 2015

Purpose - Investors, creditors, governments, and others make decisions using reasonable information provided by others. In many cases, the users of this information have goals and objectives conflicting with those of the information's producers, indicating the need for external auditors. Research design, data, and methodology - Competition in auditing has noticeably intensified globally, especially in developed countries. This means that auditors are striving to increase the efficiency of their methods. In recent years, risk-based auditing has become prominent among these efforts. In risk-assessment auditing, the auditor may directly affect the effectiveness and efficiency of the audit. Results - As a central framework, the risk assessment process improves audit quality and effectiveness such that the audit will lead to necessary changes. Previous studies have shown that risk assessment affects the nature, timing, and content of audit procedures. Conclusions - In the planning stage of an audit, audit risk assessment may identify any inappropriate or inefficient distribution of resources or determine whether the results of an audit will be ineffective or incorrect. Thus, assessing audit risk is a critical task.

• Information Systems Review
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• v.10 no.1
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• pp.165-191
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• 2008

Traditionally, information systems audit has been carried out by the auditors. So the main focuses of audit are managerial point of view, such as finding errors or missing functions. The final purpose of audit, however, is to help the organization to make better decision through better information services. So we felt that managerial point of audit should be extended to include the factors that increase the competitiveness of organization. To accomplish this goal, new factors that reflect the ideas of three groups, users, developers in addition to auditors. First, by adopting the ideas from service quality evaluation area, we develop six items and 24 indexes for information systems audit. Second, we separate the audit related parties into three groups, users, developers and auditors. The main reason is that major concerns of three groups to the system will be different considerably. Third, we quantified the weights of each group to each 6 items and 24 indexes using Analytic Hierarchy Process. Fourth, the resulting weights of each item are found to be different by the group, and possible reasons are analyzed.

• KIPS Transactions on Software and Data Engineering
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• v.8 no.5
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• pp.179-186
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• 2019

Information system audit, which provides effective diagnosis and inspection of IT governance, is applied to all aspects from planning to development and operation. However, there is a difficulty in carrying out the audit because the system for the specialized university IT project is not developed. Therefore, it is necessary to set the internal system as the audit-based application framework in order to apply it to university IT governance. In this paper, we propose a audit-based application framework of university information system developed for university. The framework has a difference from the existing audit system. By using this framework, it is possible to present a standard for the university IT project and easily approach and use it in the field. And it can be used for direct audit through this framework in the level of the auditor as well as the HQ admin. The framework categorizes the audit into three major dimensions and suggests a method that can be applied to the university information system audit through the UAFP(University Audit Framework Process) and quality assurance.

• Journal of East Asia Management
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• v.4 no.1
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• pp.23-51
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• 2023

We investigate whether the association between management overconfident tone and the level of audit effort measured by audit fees and hours differs depending on the level of earnings management. Prior studies suggest that firms led by overconfident managers are likely to initiate risky investments, report low quality financial statements, and have material weaknesses in internal control system. These characteristics, combined together, result in higher audit risk. At the same time, auditors assess audit risk based on the quality of financial reporting, measured by level of earnings management. As a result, the assess audit risk is likely to reflect the combined effect of management overconfidence and the level of earnings management. In this paper, we investigate whether auditors differentiate the effects of real earnings management (REM) and accrual-based earnings management (AEM) when they assess the audit risk related management overconfident. Using the CEO's letter published in 2018, we measure the CEO's tone representing the degree of overconfidence (i.e., activity). Based on this measure, we find that the positive association between managerial overconfident tone and audit effort is more pronounced as the level of REM is higher. However, we find that the baseline association does not vary depending on the level of AEM. These results suggest that auditors consider the managerial overconfident severer when such characteristic accompany the higher level of REM, which can be outcome of aggressive business decisions possibly leading to the higher audit risks. We further find that these results are stronger for Big 4 auditors and continuing auditors. This paper contributes to the literature and practice as follows. First, we provide contextual evidence on how auditors reflect managerial characteristics in the audit process by documenting that auditors actively increase their audit efforts only when overconfident managerial characteristics are highly likely to lead to audit risk. This result suggests that auditors conduct external auditing considering both the efficiency and effectiveness of the audit process. Second, we suggest that auditors use information obtained from a wide range of sources to identify audit risks. Our results provide evidence of how the auditing standards, which do not provide detailed guidelines for audit risk assessment, are being applied in practice. Finally, our results also enhance the understanding of how audit fees are determined. Combined with the studies related to audit pricing, we provide the important reference for discussion between the auditor and the auditee about the audit fee that has created acute tension after the enforcement of the new External Audit Act.