Activity-based costing system (ABC) adopters reported different uses of the system, inconsistent amounts of benefits gained, and consequently varying levels of satisfaction with the system. This study aims to investigate the variation in the extent of use, the magnitude of benefits, and user satisfaction with the ABC. A structured questionnaire was sent to the manufacturing companies operating in Riyadh Province, Saudi Arabia. 75 responses from ABC implementers were received. The results of this study show that the degree of ABC implementation success positively influences the extent of its use, the magnitude of benefits that have been obtained, and the overall user satisfaction with the system. These findings imply that irrespective of the characteristics of the company or the features of the system, the way the companies implement ABC might determine how much benefits can be gained and to what extent the system could be used.

The purpose of this study is to investigate the perception of auditors regarding their responsibilities and potential liabilities to third parties in the case of failure to detect fraud/material misstatements and report the findings to the appropriate party. The study proposes that auditors’ perception of their own responsibilities will depend on the level of litigation threat expected by the auditor based on his or her position in the audit firm. The questionnaire was sent to the big 4 audit firms, the global audit firms other than the big 4, and to 189 different sized local audit firms registered with the Saudi Organization of Certified Public Accountants (SOCPA). The findings of this study revealed significant variations among auditors with regards to their perceptions of their own responsibilities and liabilities to financial statements’ users affected by their expected level of exposure to litigation risk.

The purpose of this study is to explore the views of independent external auditors, financial statements’ preparers and financial statements’ users regarding the general responsibilities of auditors with a focus on their responsibility for fraud detection. A structured questionnaire survey was used as an instrument to collect data for this purpose. A total of 1,015 questionnaires were sent to three categories of respondents whereas 261 valid responses were received with an overall response rate of 26%. The findings of this study revealed a substantial audit expectation gap in Saudi Arabia with regards to auditors’ responsibilities in general and their responsibility for fraud detection in particular. Preparers of financial statements and users as well assume that auditors provide an absolute assurance that audited financial statements are free from material misstatements including fraud. In contrast to auditors’ perception, preparers and users of financial statements believe that auditors should be made liable to audit beneficiaries for losses if failed to disclose potential fraud in the audit report or for any subsequent discovery of misstated audited financial statements. This study contributes to the audit profession in Saudi Arabia by highlighting the presence of a serious expectation gap that may adversely affect the value of audit function and the reputation of auditors in Saudi Arabia. The implications of these findings should motivate professional bodies and other interested parties to cooperate and work closely to reduce the gap and find a convergence between auditors and audit beneficiaries about the role and responsibilities of auditors.