The audit expectation gap : an empirical study in Malaysia

Abstract

The auditing profession believes the increase in litigation against, and criticism of auditors can be traced to an audit expectation gap. This paper reports the findings of a questionnaire survey on the audit expectation gap conducted in Malaysia. The aims of the study are two-fold. Firstly, it examines whether an expectation gap exists in Malaysia among the auditors, auditees and audit beneficiaries in relation to the auditors' duties. Secondly, since such an expectation gap was shown to exist, this study analyzes the nature of the gap using Porter's (1993) framework. The results proved the existence of an audit expectation gap in Malaysia. The study shows that the auditees and audit beneficiaries placed much higher expectations on the auditors' duties when compared with what auditors have perceived their duties to be. The analysis of the expectation gap indicated the existence of unreasonable expectations of the part of users; deficient standards of auditing in Malaysia; and deficient performance of auditors.

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