Audit committee effectiveness : informal processes and behavioural effects

Purpose This paper seeks to investigate the conditions and processes affecting the operation and potential effectiveness of audit committees (ACs), with particular focus on the interaction between the AC, individuals from financial reporting and internal audit functions and the external auditors. Design/methodology/approach A case study approach is employed, based on direct engagement with participants in AC activities, including the AC chair, external auditors, internal auditors, and senior management. Findings The authors find that informal networks between AC participants condition the impact of the AC and that the most significant effects of the AC on governance outcomes occur outside the formal structures and processes. An AC has pervasive behavioural effects within the organization and may be used as a threat, an ally and an arbiter in bringing solutions to issues and conflicts. ACs are used in organizational politics, communication processes and power plays and also affect interpretations of events and cultural values. Research limitations/implications Further research on AC and governance processes is needed to develop better understanding of effectiveness. Longitudinal studies, focusing on the organizational and institutional context of AC operations, can examine how historical events in an organization and significant changes in the regulatory environment affect current structures and processes. Originality/value The case analysis highlights a number of significant factors which are not fully recognised either in theorizing the governance role of ACs or in the development of policy and regulations concerning ACs but which impinge on their governance contribution. They include the importance of informal processes around the AC; its influence on power relations between organizational participants; the relevance of the historical development of governance in an organization; and the possibility that the AC’s impact on governance may be greatest in non-routine situations.

"Nursing is no place for men" ― A thematic analysis of male nursing students experiences of undergraduate nursing education

Background: Surprisingly, opinion about whether men are suitable within the profession continues to be a divided issue. Men enter the profession for a multitude of reasons, yet barriers whether emotional, verbal or sexual are still present. Aim: The aim of this study was to examine the experience of men “training” to be registered nurses within a regional New Zealand context. Design: A Narrative Analysis approach was used. Participants: Five New Zealand men currently undertaking their bachelor of nursing degree at a regional tertiary institute were interviewed as to their experiences of what it meant to be a man in “training”. Method: A thematic analysis was undertaken and guided by an understanding of the way personal narratives informs the human sciences especially within the context of nursing praxis. Four key themes were identified. Results: Four key themes were identified: A career with flexibility and promise; perceived gender inequality in providing care; developing professional boundaries with female colleagues and being unique has its advantages. Conclusion: The men in this study were attracted to the profession by career stability and advancement; the opportunities for travel also figured highly. At times they felt excluded and marginalised because of their minority status within their group and the feminine nature of the curriculum. The men attempted to dispel the myth around male nurse sexual stereotypes. Some of the students behaved in a manner to exert their heterosexualness. The students in this study sensed their vulnerability in choosing nursing as a career. However, all the participants saw nursing as viable and portable career in terms of advancement and travel.

Patient group directions : the application and integration of knowledge in advancing nursing practice

Background: The introduction of Patient Group Directions (PGD) has changed significantly the way in which nurses can now administer prescription only medicines as a one-off for patients requiring this level of service. PGD’s are a written authority to administer drugs to patients that are not identified at the time of treatment. Aim: The aim of this project was to develop a PGD for use within an Outreach team to administer colloid boluses to patients presenting with hypovolemia. Method: Using a case exemplar this paper will discuss the development of a PGD using aspects of transitional change theory to highlight the potential barriers that were encountered. Implications for Practice: The implications for this PGD are wide reaching. First it now enables members from the nursing Outreach team to administer colloid fluid boluses to a prescribed patient cohort without the need for prescription. Second, it ensures the deteriorating patient has interventions initiated in a timely and appropriate manner to reduce inadvertent admission to high care areas. Last, it will improve inter-professional team-working and communication so much so that collaborative patient care reduces health costs and identifies earlier those patients requiring substantially greater nursing and medical input. Conclusion: The experience of developing a working PGD for fluid administration has meant that the Outreach team is able to respond to patients in a more effective way. In addition, it is the experience of developing this PGD that has enabled the team to contemplate other PGD’s in the execution of Outreach work.

Corporate governance quality, audit fees and non-audit services fees

This paper extends prior research on the relationship between governance quality and auditor remuneration.We examine the influence of audit committee effectiveness (ACE), a proxy for governance quality, on audit fees (AF) and non-audit services fees (NASF) using a new composite measure comprising audit committee independence, expertise, diligence and size. We find that after controlling for board of director characteristics, there is a significant positive association between ACE and AF only for larger clients. Our results indicate that effective audit committees undertake more monitoring which results in wider audit scope and higher audit fees. Contrary to our expectations, we find the association between ACE and NASF to be positive and significant, especially for larger clients. This suggests that larger clients are more likely to purchase non-audit services (NAS) even in the presence of effective audit committees probably due to the complexity of their activities. Overall, our findings support regulatory initiatives aimed at improving corporate governance quality.

Regulating audit quality : restoring trust and legitimacy

The global financial crsis, corporate failures and scandals in amny countries raise significant questions audit quality. In the UK, the FRC took the unprecedented step of codifying audit quality in its ‘Audit Quality Framework’. We analyze the extent to which audit firms, professional bodies, and investors considered the FRC proposals sufficient for addressing concerns about audit quality. Using impression management and legitimacy as a framework to analyze stakeholder responses we go beyond audit quality drivers identified by the FRC. In contrast to the drivers identified by the FRC, our focus on transparency, expertise, professionalism and commercialization of the audit shows that FRC, audit firms and professional bodies have mainly focused on issues which possibly do not pose a threat to the commercial interest of audit firms. Overall, our analysis shows that regulatory and professional bodies engaged in image management and the promotion of audit quality in an attempt to remedy tarnished image and augment their legitimacy and standing. In attempting to restore trust and legitimacy regulatory bodies, such as the FRC, have to reconcile complex often contradictory stakeholder demands.

A study of the informal interactions between audit committees and internal auditors in Australia

This paper finds evidence for the growing importance of informal interactions between the internal audit function and the audit committee (AC) in Australia – a relatively unexplored topic in the literature – using a survey of Chief Audit Executives (CAEs). It also describes the nature of these informal interactions. The most innovative elements of this paper are the findings that certain personal characteristics of CAEs, the specific knowledge and expertise of the AC chair, as well as some of the AC chair’s personal characteristics are associated with the existence (and increase) of informal interactions.

Do Big-Four affilitates earn audit fee premiums in emerging markets?

The paper investigates whether Big-Four affiliated (B4A) firms earn audit premiums in an emerging economy context, using Bangladesh as a case. The joint determination of audit and non-audit service fees is also examined using a sample of 122 companies listed in the Dhaka Stock Exchange. Our findings reveal that although the B4A firms do not generally earn a fee premiumin Bangladesh, they charge higher audit fees for clients not purchasing non-audit services. This suggests that the B4A firms may actually lower audit fees to attract non-audit services, and cross subsidizes audit fees through non-audit-services fees. The lack of a B4A premium implies that there is lack of quality audit in emerging markets. We also document that audit and non-audit service fees are jointly determined in Bangladesh. Thus, we provide evidence of joint determination of audit and non-audit service fees in an emerging economy context.

Informal interactions between audit committees and internal audit functions : exploratory evidence and directions for future research

Purpose – This paper aims to recognise the importance of informal processes within corporate governance and complement existing research in this area by investigating factors associated with the existence of informal interactions between audit committees and internal audit functions and in providing directions for future research. Design/methodology/approach – To examine the existence and drivers of informal interactions between audit committees and internal audit functions, this paper relies on a questionnaire survey of chief audit executives (CAEs) in the UK from listed and non-listed, as well as financial and non-financial, companies. While prior qualitative research suggests that informal interactions do take place, most of the evidence is based on particular organisational setting or on a very small range of interviews. The use of a questionnaire enabled the examination of the existence of internal interactions across a relatively larger number of entities. Findings – The paper finds evidence of audit committees and internal audit functions engaging in informal interactions in addition to formal pre-scheduled regular meetings. Informal interactions complement formal meetings with the audit committee and as such represent additional opportunities for the audit committees to monitor internal audit functions. Audit committees’ informal interactions are significantly and positively associated with audit committee independence, audit chair’s knowledge and experience, and internal audit quality. Originality/value – The results demonstrate the importance of the background of the audit committee chair for the effectiveness of the governance process. This is possibly the first paper to examine the relationship between audit committee quality and internal audit, on the existence and driver of informal interactions. Policy makers should recognize that in addition to formal mechanisms, informal processes, such as communication outside of formal pre-scheduled meetings, play a significant role in corporate governance.

Audit pricing and product differentiation in small private firms : evidence from Thailand

Purpose – There is limited evidence on how differences in economic environments affect the demand for and supply of auditing. Research on audit pricing has mainly focused on large client markets in developed economies; in contrast, the purpose of this paper is to focus on the small client segment in the emerging economy of Thailand which offers a choice between auditors of two different qualities. Design/methodology/approach – This paper is based on a random stratified sample of small clients in Thailand qualifying for audit exemption. The final sample consists of 1,950 firm-year observations for 2002-2006. Findings – The authors find evidence of product differentiation in the small client market, suggesting that small firms view certified public accountants as superior and pay a premium for their services. The authors also find that audit fees have a positive significant association with leverage, metropolitan location and client size. Audit risk and audit opinion are not, however, significantly associated with audit fees. Furthermore, the authors find no evidence that clients whose financial year ends in the auditors’ busy period pay significantly higher audit fees, and auditors engage in low-balling on initial engagements to attract audit clients. Research limitations/implications – The research shows the importance of exploring actual decisions regarding audit practice and audit pricing in different institutional and organizational settings. Originality/value – The paper extends the literature from developed economies and large/listed market setting to the emerging economy and small client market setting. As far as the authors are aware, this is the first paper to examine audit pricing in the small client market in an emerging economy.

The Corporate Governance Effects of Audit Committee

This chapter provides a synthesis and evaluation of empirical research on the governance effects associated with audit committees. Given recent policy recommendations in several countries aimed at strengthening these committees, it is important to establish what research evidence demonstrates about their existing governance contribution. A framework for analyzing the impact of audit committees is described, identifying potential perceived effects which may have led to their adoption and documented effects on aspects of the audit function, on financial reporting quality and on corporate performance. It is also shown that most of the existing research has focused on factors associated with audit committee existence, characteristics, and measures of activity and there is very little evidence on the processes associated with the operation of audit committees and the manner in which they influence organizational behavior. It is clear that there is no automatic relationship between the adoption of audit committee structures or characteristics and the achievement of particular governance effects, and caution may be needed over expectations that greater codification around factors such as audit committee members’ independence and expertise as the means of ‘‘correcting’’ past weaknesses in the arrangements for audit committees. The most fundamental question concerning what difference audit committees make in practice continues to be an important area for research development. For future research we suggest: (1) greater consideration of the organizational and institutional contexts in which audit committees operate; (2) explicit theorization of the processes associated with audit committee operation; (3) complementing extant research methods with field studies; and (4) investigation of unintended as well as expected consequences of audit committees.

Ineffective cerebral perfusion related to increased intracranial pressure secondary to subarachnoid haemorrhage : An examination of nursing interventions

Considered a condition of the elderly population, stroke will soon be the leading cause of death globally. In Singapore it is the fourth leading cause of death after cancer and heart disease. Subarachnoid haemorrhage, when compared with an embolic stroke, has a more devastating outcome because of the deleterious complications associated with it. Vasospam, re-bleeding and global cerebral ischemia are three of the most prominent complications. Therefore, nursing care and interventions developed to reduce the incidence of complications and optimise neurological function are critical in the acute phase of this condition. Using a casestudy approach this article will discuss and offer a rationale to a number of key nursing interventions based around a nursing care plan designed to reduce the incidence of complications.

Meeting the nutrition challenge of stage 3 renal failure : considerations for nursing practice

Self-care management is needed for effective management of chronic kidney disease. The main aim for treatment or management of chronic kidney disease is to delay the worsening of kidney function, and to prevent or to manage the co-morbidities. Selfcare management is not easy, and patients will face many challenges, especially when they cannot get use to the new treatment plan. One of the challenges they face is dietary restriction, which is a very important aspect in any self-care management programme. Chronic kidney disease patients require a low-protein, low-sodium, low-potassium, and low-phosphorus diet. There are several strategies patients can undertake to ensure adherence, such as self-monitoring their dietary habits and type of food consumed using a food diary; involving social support, such as family members and spouse to help them to adhere to their diet restrictions; setting goals and providing positive reinforcement when they achieved the targeted goals; joining self-management programmes to equip themselves with the necessary skills so that they can better adhere to the treatment regimes, including diet restriction; and lastly, having the knowledge about their regime, and using this knowledge to help them understand and improve their adherence.

The pathophysiology of ischaemic stroke : considerations for emergency department advanced practice nursing

Stroke is the fourth most important cause of death in Singapore. Its major predisposing factors include hypertension, type 2 diabetes mellitus and hyperlipidaemia; all modifiable diseases if treated early. However, with Singapore’s elderly population, the risk and rates of stroke are ever increasing. The nature of a stroke can be categorised as eitherh aemorrhagic or ischaemic; the former caused by arterial rupture, the latter by arterial blockage; both can be devastating in their prognosis and outcome. This paper will discuss the pathophysiology of ischaemic stroke while identifying some of the key features of ischaemia on different areas of the brain relative to the artery that feeds them. Thoughts for Emergency Department advanced practice nursing will also be discussed.

The facilitator files : supporting the supporters of nursing students

Nurse education in Australia has undergone a substantial transformation in the course of its professional history. The use of experiential teaching and learning approaches in both pre and post registration courses has escalated dramatically and resulted in the extensive use of hospital based clinical experiences for student learning. The role of the clinical facilitator is used to provide stimulation to the affective and cognitive domains of student professional development and additionally is often used as a vehicle for student assessment. While most tertiary nursing schools utilise hospital clinical experiences widely, few studies have examined whether clinical facilitators have the necessary tools to effectively support and assess students in the clinical environment. Although employed for their clinical expertise and understanding of specific clinical contexts, facilitators are expected to have an understanding of experiential learning, how it informs the undergraduate curriculum and be able to support the development of neophyte nurses as they learn to apply theoretical concepts to the increasingly complex realm of patient care. Additionally, clinical facilitators are often employed on a casual basis and as a consequence of the casualisation of the facilitator workforce, universities are continually recruiting new clinical facilitators to these positions. This paper will explore a trial of facilitator education offered to clinical facilitators at the Queensland University of Technology, School of Nursing campus in Brisbane, Australia. It will report on the use of a series of student/facilitator “vignettes” created specifically for the purpose of facilitator education and how these interactions have been embedded within a wider educational package to support facilitators in their development as facilitators rather than teachers of nursing education. Finally, it will discuss the implications of facilitator preparedness on their ability to support and assess nursing students as they engage in the important transition from neophyte to registered nurse.