Abstract
Purpose: ethical and cultural factors in the auditing field; due to the property of being invisible; They are not easily observable, and for this reason, asymmetric information appears and the company and the capital market move out of their optimal balance, which means market failure. Based on this, moral and cultural factors affect the interests of auditors and company stakeholders. The purpose of this research is to investigate the role of cultural factors and professional ethics of auditors on the interests of companies in the form of dynamic game theory.
Method: The current research is of developmental type. In the present research, the game theory approach has been used. The first actors were the managers and board members of the top 50 capital market companies. The second community is the trusted members of the trusted auditing institutions of the Stock Exchange Organization. A questionnaire was used to collect information.
Findings: In this research, three neural network approaches of support vectors, Bayesian and Crossberg anti-propagation were used to repeat the game and create Nash equilibrium. Based on the results of Crossberg's anti-diffusion method, it has higher accuracy in modeling the behavior between players.
Conclusion: The results showed the fact that the increase of cultural and ethical indicators have a negative effect on the price and a positive effect on the company's sales. As a result, the improvement of cultural and ethical indicators increases the interests of all stakeholders and actors active in the capital market.
Contribution:Deviation from cultural and ethical indicators by auditors increases inefficiency in the company and reduces the level of interests of the beneficiaries.
Keywords
Main Subjects
Anastasopoulos NP, Asteriou D (2013) Applications of game theory and evolutionary game theory in auditing. In: Game theory: economics, theoretical concepts and fnance applications, pp 67–86. https://www.proquest.com/openview/84adf681b7f0d58b17bdcac01b0a2339/1?pq-origsite=gscholar&cbl=2034863
Azarberahman A, Kamyabi Y, Malekiyan E.(2022) The Hegemony of the Culture of Professional Ethics in Audithing and Evaluating its Consequences. 6 (12) :57-95 (In Persian).
Becker, Jan-Michael, Kristina Klein, and Martin Wetzels. 2012. Hierarchical Latent Variable Models in PLS-SEM: Guidelines for Using Reflective-Formative Type Models. Long Range Planning 45: 359–94.
Benjiang M, Zhang Y, Qin Y, Bashir MFJESwA. Optimal insurance contract design with “No-claim Bonus and Coverage Upper Bound”. under moral hazard. 2021; DOI: 178:115050.
Blue, G., Seyyedi, S. J., Ghazinoori, S., & Barzide, F. (2021). Survive Factors Influencing on Tendency of Internal Auditors for Whistle - blowing in Iran. Accounting and Auditing Review, 28(4), 574-597. doi: 10.22059/acctgrev.2021.327616.1008582(In Persian).
Howieson, Bryan. 2013. Quis Auditoret Ipsos Auditores? Can Auditors Be Trusted? Australian Accounting Review 23: 295–306.
Institute of Chartered Accountants of England & Wales (ICAEW). 2008. Reconciling Stakeholders Expectation of Audit. Audit Quality Forum. Available online: www.icaew.co.uk/auditquality (accessed on 5 January 2019).
J.-W. Chang, “Monitoring and competing principals: a double-edged sword,” Journal of Economic Theory, vol. 189, Article ID 105101, 2020.View at:
Koohi Rostamkalaee, Z., Jafari, M. & Gorji, H.A. A systematic review of strategies used for controlling consumer moral hazard in health systems. BMC Health Serv Res 22, 1260 (2022). https://doi.org/10.1186/s12913-022-08613-y
Laitinen EK, Laitinen T (2015) A probability tree model of audit quality. Eur J Oper Res 243(2):665–677.
Liang Yuan , Xiaorui Tao , Thomas Stephen Ramsey , and Dagmawi Mulugeta Degefu , Simulating the Principal-Agent Relationship between Enterprise Owners and Professional Managers Using Evolutionary Game Theory and System Dynamics, Volume 2021 , Article ID 3881254, https://doi.org/10.1155/2021/ 3881254.
Monroe, Gary S., and David R. Woodliff. 1994a. Great Expectations: Public Perceptions of the Auditor’s Role. Australian Accounting Review 4: 42–53.
Nikolaos Anastasopoulos & Dimitrios Asteriou, 2021. "Optimal dynamic auditing based on game theory," Operational Research, Springer, vol. 21(3), pages 1887-1912, September.
noshfar, A., Mohseni, A., & Ghasemi, M. (2022). Meta-Analysis of Factors Affecting Ethical Decision Making in the Accounting and Auditing Profession. Governmental Accounting, 8(2), 143-166. doi: 10.30473/gaa.2021.60439.1511(In Persian).
o'Blay, A. D., E. S. Gooden, M. J. Mellon, & D. E. Stevens. 2019. Can social norm activation improve audit quality? Evidence from an experimental audit market. Journal of Business Ethics, 156(2): 513-530.
Porter, Brend, and Catherine Gowthorpe. 2004. Audit Expectation-Performance Gap in the United Kingdom in 1999 and Comparison with the Gap in New Zealand in 1989 and 1999. Edinburgh: The Institute of Chartered Accountants of Scotland.
Porter, Brenda, Ó hÓgartaigh C. Hogartaigh, and Rachel Baskerville. 2012. Audit Expectation-Performance Gap Revisited: Evidence from New Zealand and the United Kingdom. Part 1: The Gap in New Zealand and the United Kingdom in 2008. International Journal of Auditing 16: 101–29.
Porter, Brenda. 1993. An Empirical Study of the Audit Expectation-Performance Gap. Accounting and Business Research 24: 49–68.
qashqai, A., & biglar, K. (2020). The place of creative accounting among Iranian auditors With an emphasis on ethics and professional behavior. Journal of Accounting and Management Vision, 2(20), 100-113. (In Persian).
Ramezani, H, Reza., Azinfar, K., Gholamnia Roshan, H. R., Fallah, R, (2022), The Role of Islamic Culture in Auditors' Responsibility and The Quality of Audit in The Iranian Environment, Journal of Management Accounting, Vol. 15, No.55(In Persian).
Sadeghi, M., Heirany, F., Taftiya, A, (2022), Developing an audit culture model with a Grounded Theory Approach, Journal of Management Accounting, Vol. 15, No.55(In Persian).
Sadeghian, M., Jahangirnia, H., Gholami Jamkarani, R. (2019). The role of ethics in strategic interaction between independent auditor and management based on game theory. Journal of Management Accounting and Auditing Knowledge, 8(29), 43-56.
Salehi, M., Aljhlini, A.K. and Shafeeq Nimr Al-Maliki, H. (2023), "The effect of auditors’ psychological characteristics on cultural values and social health", Management Research Review, Vol. 46 No. 4, pp. 485-507.
Sangani, M, H., Abdoli, M., Valiyan, H, (2021), Investigating the Periodic Cognitive Biorhythmic Cycle Theory in Auditor Information Foraging Behavior, Journal of Management Accounting, Vol. 14, No.50. (In Persian).
Shafer WE, Wang Z. Effects of ethical context on conflict and commitment among Chinese accountants. Managerial Auditing Journal. 2010; 25(4): 377–400.
Stevenson, Mark. 2019. Can Auditors Close the Great Expectation Gap for Good? Pivot Magazine. February 2 CPA. Available online: https://www.cpacanada.ca/en/news/pivot-magazine/2019-01-02-expectation-gap-roundtable (accessed on 10 February 2019).
Taslima Akther and Fengju Xu , (2020), Existence of the Audit Expectation Gap and Its Impact on Stakeholders’ Confidence: The Moderating Role of the Financial Reporting Council, Int. J. Financial Stud. 2020, 8(1), 4; https://doi.org/10.3390/ijfs8010004
Yuyan G., S. Lixin (Nancy), W. Donghui & Y. Zhifeng. 2016. Do School Ties between Auditors and Client Executives Influence Audit outcomes? , Journal of Accounting and Economics, 61: 506-520.
Zanganeh, M. & Seraji, F. (2023). A Study of the Effect of Professionalism, Organizational Culture, and Leadership Style on Auditors’ Performance Regarding the Moderating Role of Spiritual Intelligence. Studies of ethics and behavior in accounting and auditing, 3(2), p. 75-94. (In Persian).
Zhang Y, Wei L (2022) Philanthropy, audit firms culture and auditor independence. PLoS ONE 17(11): e0277567.