The Influence of the Business Risk-Based Auditing Application on the Audit Process: An Empirical Investigation in the Yemeni Context

This paper examines the impact of the modern audit approach, Business risk auditing (BRA), on the audit process. The cost of the BRA application and the impacts of this approach on the analytical procedures, internal controls, and audit evidence are the primary issues of this study. An empirical des...

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Bibliographic Details
Published in:Journal of Business Strategy Finance and Management 2023-01, Vol.4 (2), p.214
Main Authors: Zaid Mohammed Esmail, S.M Imamul Haque
Format: Article
Language:English
Subjects:
Accounting firms
Audit evidence
Auditing procedures
Auditing standards
Auditors
Efficiency
Financial statements
Influence
International relations
Planning
Research methodology
Risk assessment
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Summary:This paper examines the impact of the modern audit approach, Business risk auditing (BRA), on the audit process. The cost of the BRA application and the impacts of this approach on the analytical procedures, internal controls, and audit evidence are the primary issues of this study. An empirical design using a structured questionnaire has been adopted to collect the data required to test the study hypotheses. The data was analyzed using the PLS-SEM technique, a hybrid of the partial least squares that is based on structural equation modelling. The study found that the high costs resulting from the BRA approach represent significant obstacles to implementing this methodology in the Yemeni audit context. However, auditors in Yemen believe that applying the BRA approach positively impacts the conduct of audits. The findings revealed a significant influence of the BRA approach on each audit procedure and audit quality in general. The present study has practical implications where it could raise the Yemeni auditors awareness of the BRA approach, which is directly related to many International Auditing Standards (IAS). Therefore, BRA adoption will also assist in meeting ISAs prerequisites. In addition to being the first study that looks at the advanced audit methods in Yemen, it is one of the few to examine the spread of BRA in developing nations.
ISSN:2583-2832
2583-2832
DOI:10.12944/JBSFM.04.02.04