The effect of the quality of external auditing on the relationship between the rules of professional conduct and the quality of financial reporting

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Abstract

This study aimed to identify the effect of the quality of external auditing on the relationship between the rules of professional conduct and the quality of financial reporting by Jordanian industrial shareholding companies (Abu Afifa, Alsufy, & Abdallah, 2020; Haloush, Alshurafat, & Alhusban, 2021). The research data that composed this study originated from legal auditors and practitioners in the audit profession in Jordan (according to the Jordanian Association of Certified Public Accountants, JACPA, https://jacpa.org.jo/, there was a total of 402 auditors in Jordan at that time). After identifying the study community, a random sample was executed. An online questionnaire was carried out. The study relied upon both descriptive and inferential approaches. In addition to using statistical methods in the descriptive approach, other methods included; frequencies, percentages, arithmetic mean, and standard deviation, while in the inferential approach, simple linear regression and hierarchical regression were implemented. The results of the study showed a strong relationship between the application of the rules of professional conduct and the quality of external auditing from the point of view of external auditors in Jordanian industrial shareholding companies.

Keywords: Quality of External Auditing, Rules of Professional Conduct, Quality of Financial Reporting, Jordanian Industrial Shareholding Companies

Authors’ individual contribution: Conceptualization — R.R.I.A.H., G.F.A.-M., E.G., and A.A.A.A.; Resources — R.R.I.A.H., G.F.A.-M., E.G., and A.A.A.A.; Writing — Original Draft — R.R.I.A.H. and A.A.A.A.; Writing — Review & Editing — G.F.A.-M. and E.G.; Supervision — R.R.I.A.H. and G.F.A.-M.; Project Administration — E.G.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: K16, M41, M42

Received: 24.04.2022
Accepted: 25.07.2022
Published online: 28.07.2022

How to cite this paper: Al Husban, R. R. I., Al-Matarneh, G. F., Ghaidan, E., & Alhusban, A. A. A. (2022). The effect of the quality of external auditing on the relationship between the rules of professional conduct and the quality of financial reporting. Corporate & Business Strategy Review, 3(1), 153–160. https://doi.org/10.22495/cbsrv3i1art14