Iranian Auditors Perspectives about Auditing of Fair Value Estimates

Document Type : Research Paper

Authors

1 Associate Prof., Department of Accounting, Faculty of Social Sciences & Economics, Alzahra University, Tehran, Iran

2 Ph.D. Candidate, Department of Accounting, Faculty of Social Sciences & Economics, Alzahra University, Tehran, Iran

Abstract

Objective: The dominant approach in international financial reporting standards is measuring fair value.The complexity of estimates of fair value mentioned in the International Financial Reporting Standard No. 13 will create challenges in auditing and it affects the quality of the audit; therefore, the main objective of this study is examining the views of Iranian auditors about the audit of fair value estimates and its audit challenges.
Methods: Data was collected by questionnaire.  In this study, statistical tests like One-Sample T-Test and Friedman have been used for analyzing data.
Results: The findings of 118 collected questionnaires indicate thatthe use of Audit Standard 540 approved by the Audit Organization is difficult and requires reconsideration. Auditors believe that the most important audit challenge with regard to measuring fair value is the absence of an active market for most assets and liabilities. Also, according to the findings, the audit challenges of the measurement of the fair value for financial assets and liabilities are different from non-financial assets and liabilities.
Conclusion: Audit difficulty Levels 2 and 3 of the fair value, the lack of educational guidelines, lack of auditor's competence and lack of experienced specialists can affect the quality of auditing fair value, and these issues point to the need for auditing knowledge and revision of audit standards. Also, the Audit Organization is the most important reference in the codification of educational guidelines on auditing fair value estimates; therefore, it is necessary that the Audit organization takes the necessary steps to codification these guidelines.

Keywords

References

References
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Accounting and Auditing Review
Volume 26, Issue 2
2019
Pages 255-278

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