Conceptualizing Audit Fatigue in the Context of Sustainable Supply Chains

Muhammad Kamran Khalid, Mujtaba Hassan Agha, Syed Tasweer Hussain Shah and Muhammad Naseer Akhtar
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Muhammad Kamran Khalid: Department of Operations & Supply Chain Management, NUST Business School, National University of Sciences and Technology, Islamabad 44000, Pakistan
Mujtaba Hassan Agha: Department of Operations & Supply Chain Management, NUST Business School, National University of Sciences and Technology, Islamabad 44000, Pakistan
Syed Tasweer Hussain Shah: Faculty of Engineering Management, NUST College of EME, National University of Sciences and Technology, Islamabad 44000, Pakistan
Muhammad Naseer Akhtar: Department of Operations & Supply Chain Management, NUST Business School, National University of Sciences and Technology, Islamabad 44000, Pakistan

Sustainability, 2020, vol. 12, issue 21, 1-11

Abstract: Organizations rely heavily on audits and compliance related activities to prove their competency, credibility, and firm performance. Sustainability audits encompass entire supply chains and are very complex due to, firstly, the global nature of supply chains and, secondly, the expansive scope of sustainability, which may include financial, manufacturing, social, and environmental audits. Adding to this dilemma is the absence of a consensus on standards related to sustainability, resulting in differences, variations, and multiple interpretations. While the frequency, complexity, and scope of audits has increased, unfortunately so has the incident of audit fraud, which has seen increasing media coverage in recent times, often implicating major multinationals and their supply chains. We posit that this trend of increasing audit activity is causing “audit fatigue”, which, in turn, may influence the audit outcome, i.e., either audit fraud or a clean audit. This study proposes that audit fatigue is a genuine issue faced by organizations and needs to be conceptualized.

Keywords: audit fatigue; sustainability; supply chain; audit fraud; clean audit (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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