Auditing the Statement of Cash Flows for Jordanian Public Listed Companies
The study aimed to explore the process of auditing the statement of cash flows by auditors of Jordanian public listed companies. In doing so, it used a structured questionnaire that surveyed the views of auditors who work for audit firms that audit the financial statements of Jordanian public listed companies. In particular, auditors were asked about the importance of the statement of cash flows for their audit and their opinion on the financial statements, the extent of their auditing of detailed components of the statement of cash flows, and their use of specific financial ratios related to the statement of cash flows in predicting the company’s continuance as a going concern. Findings of the study suggest that auditors of Jordanian public listed companies do generally recognize the importance of the statement of cash flows and do generally audit many detailed items of the statement in its operational, investment, and financial sections, and do use financial ratios that employ cash flow measures to evaluate the company’s going concern hypothesis. However, the level of such perceived importance and use of audit procedures was reported as being relatively limited, an issue that raises questions over the quality of such audits and the awareness of auditors as to the importance of auditing the statement of cash flows.