TECHNOLOGY ADOPTION

ARE THE SMALL-MEDIUM SIZE AUDIT FIRMS READY?

Abstract

 Technology in this Fourth Industrial Revolution (IR4.0) keeps changing and moving very fast. Technology is transforming some aspects of society as well as the working industry. The area of auditing is at a crucial moment. Independent audits continue to be conducted annually, which rely primarily on historical data for the review and reporting routines. Because of the changes, investors, audit committees, regulators, and other stakeholders' expectations regarding the use of technology advances in the nature of the audit are rapidly evolving. Big firms' audit already makes significant changes and evolve accordingly with technology to ensure they boost customers' confidence with their initiative by using an advanced technological system as their audit tools. However, small and medium audit firms recorded a significant number of zero technological development which enlarge their gap with big audit firms. Previous research is focusing more on the technology in big firms. The study is inadequate on technology adoption in small-medium audit practices. In accordance with these matters, this study aims to examine the relationship between technology complexity, top management commitment, and industry pressure on the adoption of technology in small and medium audit firms. This research provides primary data by using a self-administration survey that originally come from 96 auditors from small and medium audit firms in Klang Valley areas. Statistical studies such as descriptive analysis, correlation analysis, and regression analysis have been carried out. The result of this study indicates that top management commitment and industry pressure have a significant influence on the adoption of technology in audit SMPs. However, the technology complexity reported has an insignificant influence on technology adoption in small and medium-sized audit practices in Malaysia. Thus, this research contributes to the audit industry, audit profession, decision-makers, government, and policymakers by presenting evidence on factors that could influence the adoption of technology in small and medium-sized audit practices.