Exploring the Role of Technology and its related factors in shaping

Auditing Practices: An Empirical Study in the Indian Context

Dr. Garima Bansal

Abstract:
Purpose: The aim of the paper is to explore the influence of knowledge of technology (KT), ease of use (EOU) of technology,
perceived benefits of technology (PBT), and technology challenges (TC) on adoption of technology (TA) and auditing
practices (AP) by auditors in the National Capital Region (NCR) of India.
Methodology: 246 auditors were selected through convenience sampling. Factor analysis and SEM were used to analyse
data using SPSS 25 and AMOS.
Findings: The results indicate that KT, EOU, and PBT emerge as influential determinants of TA in AP. Similarly,
results found weak association between TA and AP. However, the study found no influence of TC on TA in AP.
Originality: In the last decade, most of the studies investigating the impact of technology adoption and its related factors
on auditing practices have been conducted outside India i.e., USA, Italy, Jordan, Malaysia, Saudi Arabia, etc. with very
few studies conducted within India and all of them in Kerala. Therefore, the current study addresses this gap and explores
the connection between KT, EOU, PBT and TC with TA and AP in NCR, India. This study presents a unique and new
technology adoption model in AP in India.

Keywords: Auditing practices, technology, challenges, ease of use

1. Background perform a financial audit without the use of advanced

There has been a revolutionary change in the landscape technology tools. Professionals sees the use of these tools
of accounting and auditing with the evolution of as a way to improve productivity, gather audit evidence
technology. Auditing is the method of examining a and communicate with stakeholders securely (Pedrosa
company’s accounting records and financial statements et al., 2015). Auditors utilize these tools to accomplish
and to check their accuracy and compliance with the pertinent processes, including evaluating, classifying,
law. On the other hand, accounting includes various summarizing, organizing, executing calculations, and
services, including preparing financial statements (FS), data extraction and analysis (Mujalli, 2024).
analyzing cash flow statements and book-keeping.
Due to the increasing ubiquity of technology in
Technology enables audit firms to use ‘Generalized
businesses, auditors must now satisfy financial
Audit Software’ (GAS) and other tools to efficiently
statement users (Knechel et al., 2020). Emerging
maintain their credibility (Thottoli & Thomas, 2020).
technology tools allow auditors to fulfill the needs of
Technology in auditing is very important because it their stakeholders and provide timely and high quality
establishes the best way to check the effectiveness of services while keeping costs in control. Together with
the audit and the consistency of each task. Although increasing productivity and operational efficiency, the
as businesses proceed with investments regarding use of evolving technology tools ensures high audit
technology-enabled transactions, auditors are indeed quality, reduced operational costs and mitigated audit
facing challenges keeping up with these fulfilling risks (Okab, 2013). To achieve this, auditors must
dynamic demands. Today, it is nearly impossible to adopt technology in their auditing practices (Castka et

Dr. Garima Bansal,

HOD and Assistant Professor,
Hindu Girls College, Sonipat, Haryana
al., 2020). However, compared to small and medium The committee provides various software services such
enterprises (SME) audit firms, big and large-sized audit as ‘AI Audit Automation Tool Assure AI’, ‘GST Audit
firms use more technology tools and audit software Software Bill Mantra’, ‘Accounting & Audit Automation
(Siew et al., 2020). The absence of computerized Tool – Suvit’, and ‘MICROSOFT 365’, etc. to facilitate
auditing training, and audit assistants’ ignorance of process automation. These software tools help in
audit software features are major barriers to the use of client engagement, analytical procedures and ensuring
technological tools in auditing for SME firms (Abou- compliance with Accounting Standards, Auditing
El-Sood et al., 2015). DeLone and McLean (2003) Standards and other laws. These tools also aid in the
found that implementation expenses of specialised documentation of various audit processes, enhancing
audit tools or software and the need for employees’ efficiency and ease of conducting audits. The current
training are key challenges that auditors face. study explores the connection between the adoption
of technology tools, ease of use of tools, knowledge
In India, the Committee for Members in Practice of technology, challenges, and perceived benefits of
(CMP) operates as a non-standing regulatory body technology with auditing practices in NCR, India.
under the Institute of Chartered Accountants of
India (ICAI), established as per the provisions of the Table 1 highlights that in the last decade most studies
Chartered Accountants Act, 1949. Initially named investigating the impact of the adoption of technology
the ‘Committee for Capacity Building of CA Firms tools and their related factors on auditing practice
and Small & Medium Practitioners’ (CCBCAF & have been conducted outside India, with very few
SMP), it merged two prior committees to facilitate studies conducted within India, all of them in Kerala.
the consolidation and capacity building of CA firms This paper is possibly the first attempt to redress such
and empower ‘Small & Medium Practitioners’ (SMPs). scholarly neglect.

Table 1: Previous International and National studies

Sr. Title Research Sample Size Country Findings Author(s) &

No. Methodology Year
1 “Emerging Qualitative 14 Auditors Italy Auditors hope that Vitali &
digital and field- (4 Big4 automation and smart Giuliani,
technologies and based Study firms and 9 tools will improve (2024)
auditing firms: (Interview) Non-Big4 their daily operations
Opportunities firms) and make them
and challenges” more efficient and
productive.
Smaller enterprises'
adoption of advanced
technology is impeded
by the difficulty of
audit clients' lack
of technological
readiness.
Furthermore, it is
acknowledged that
auditors must gain IT
expertise, which may
result in the hiring
of new professional
profiles.

Vol. 1 Issue 1 ICAI Garuda 41

2 “Innovation Quantitative, 200 auditors Jakarta The findings show that Handoko, et
Diffusion and casual and auditors' acceptance al., (2023)
Technology explanatory of technology
Acceptance research using is significantly
Model in primary survey influenced by
Predicting perceived trialability,
Auditor compatibility and
Acceptance complexity. However,
of Metaverse perceived observability
Technology” and EOU does not
significantly affect
auditors’ intention to
accept technology.
3 “Influence of Quantitative 91 internal Jordan The study reveals that Lutfi &
technology (Primary auditors using technology Alqudah,
related factors Survey) enabled audit software (2023)
on usage of enhances internal audit
computer assisted effectiveness and the
audit tools.” technology knowledge
factor acts as a positive
moderator.
4 “Big data Quantitative 130 auditors Jordan The study reveals that Al-Ateeq et
analytics in (Primary when auditors perceive al., (2022)
auditing and the Survey) the usefulness of data
consequences analytics, it directly
for audit quality: improves their audit
A study using quality without them
the technology using it. However,
acceptance model ease of use does not
(TAM)” influence quality of
audit work in a similar
way.
5 “Emerging Quantitative 321 Kerala The study affirms that Thottoli et
technology and (Primary Chartered (India) technology related al., (2022)
auditing practice: Survey) Accountants factors like adoption,
analysis for future challenges, and ease of
directions” use positively affect the
practice of auditing,
while PBT exhibits a
negative association
with it.
6 “Mediating effect Quantitative 105 USA The study shows the Damerji &
of use perceptions (Primary impact of perceived Salimi (2021)
on technology Survey) ease of use and
readiness perceived usefulness
and adoption on the relationship
of artificial between accounting
intelligence in students' technology
accounting” readiness and adoption
of AI through
mediation analysis and
demonstrates that both
factors influence the
relationship.
42 ICAI Garuda Issue 1 Vol. 1
7 “Organizational Quantitative 158 audit Malaysia The study shows Siew et al.,
and (Primary, firms that environmental (2020)
environmental Survey) factors such as
influences in perceived support
the adoption of from professional
computer-assisted accounting bodies
audit tools and and the complexity
techniques of clients' accounting
(CAATTs) by information
audit firms in systems, along with
Malaysia” organizational factors
like employee IT
competency and
commitment of top
management, are
factors of adoption of
technology.

8 “Impact of Quantitative Not Kerala The study highlights Thottoli,

Information (Primary Mentioned (India) the positive impact (2021)
Communication Survey study) of technology
Technology competency and
Competency training on auditing
Among Auditing practice. Auditors
Professionals” with this knowledge
and training achieve
improved audit
efficiencies, ensure
fairness in financial
statements and meet
audit job deadlines.
The authors also
emphasized the
importance of audit
software for SME in
order to meet clients’
need.

9 “Characteristics Quantitative 89 Kerala The study found a Thottoli

of information (Primary Chartered (India) positive association & Thomas
communication Survey study) Accountant between technology (2020)
technology and competence,
audit practices: technology training
evidence from and technology
India” adoption with audit
practice. However,
there is a negative
association between
technology confidence
and audit practice.

Vol. 1 Issue 1 ICAI Garuda 43

 10 “Factors That Quantitative 105 internal Jordan The study reveals Al-Hiyari
Influence (Primary auditors that the adoption of et al.,
the Use of Survey study) technology is driven (2019)
Computer by performance and
Assisted Audit effort expectations,
Techniques suggesting that
(CAATs) policymakers
By Internal should promote
Auditors in technology adoption
Jordan” through education,
increased investment
in technical
infrastructure and
additional training
programs.

11 “Does Audit Quantitative 114 public Malaysia The study found Ismail et al.,
Quality Matter (Primary sector auditor competency (2019)
in Malaysian Survey study) auditors to be the strongest
Public Sector predictor affecting
Auditing?” audit quality in the
public sector audit.

12 “Influence of Quantitative 380 auditors Indonesia The authors’ Supriadi et

Auditor Com- (Primary finding show a al., (2019)
petency in Us- Survey study) positive association
ing Information between auditors’
Technology on competency and use
the Success of of technology, which
E-audit System ultimately leads
Implementation” to the successful
implementation of
E-Audit system.

13 “Information Quantitative 56 auditors Malaysia The findings show Mustapha

Technology in (Primary, that technology, and Lai,
Audit Processes: Survey study) predominantly (2017)
An Empirical employed by senior
Evidence from auditors and audit
Malaysian managers, facilitates
Audit Firms” the generation of
financial statements,
sample selection,
and audit working
papers, enhancing
efficiency and
accelerating audit
processes.

44 ICAI Garuda Issue 1 Vol. 1

14 “Examining Qualitative 10 cases UK and The results show that Mahzan
the adoption of (Interview) Malaysia within the sphere of & Lymer,
computer-assisted adopting Generalized (2014)
audit tools and Audit Software
techniques: Cases (GAS), two variables
of generalized namely ‘performance
audit software expectancy and
use by internal facilitating conditions’,
auditors” are notably influential
factors. However, the
study suggests ‘social
influence’ and ‘effort
expectancy’ are not as
significant factors in
this particular context
of IT adoption.
15 “Study of Quantitative 55 Audit Saudi The study identified Razi &
attributes that (Primary, experts Arabia PBT, and company Madani,
affect adoption Survey study) readiness as positive (2013).
of technology in factors in the adoption
audit” of technology for
audit tasks. However,
technology adoption
risk and external
pressure have a
negative impact on TA.
Source: Author’s Study
The present paper addresses the subsequent research 2. Literature Review and Hypotheses
questions (RQs): Formulation
RQ1: To what extent does KT influence the TA in 2.1. Influence of knowledge of technology (KT) on
auditing practice? the adoption of technology (TA) and auditing
practices (AP) by auditors
RQ2: To what extent does EOU of technology impact
the TA in auditing practice? Merhout & Buchman (2007) reveals that
auditors must possess the knowledge of
RQ3: To what extent does PBT affect the TA in technology (KT) and abilities in order to
auditing practice? employ technology for more precise and
effective auditing. Thottoli (2021) and
RQ4: To what extent does TC influence the TA in Ismail et al., (2019) also found competency
auditing practice? in technology as a predictor of technology
RQ5: To what extent does TA influence the AP by adoption. Technology competency enhances
auditors? audit efficiencies, ensures fairness in financial
statements and meets audit task deadlines
The current research paper is structured as follows. (Thottoli, et al., 2022). Auditors with a vast
Section 2 provides a detailed review of prior literature. knowledge of technology can enhance the
Section 3 explains the conceptual framework applied benefits of technology enabled audit software
in this research paper on the basis of the “Innovation and risks can be minimised, resulting in high
Diffusion Theory” (IDT) and the “Technology level of audit effectiveness (Lutfi & Alqudah,
Acceptance Model” (TAM). Section 4 explains the 2023). On the basis of past literature, the first
quantitative and primary study conducted to apply and second hypotheses of the study are:
this technology adoption model in auditing practices
in India. Results and hypotheses testing are presented H1A: Knowledge of technology (KT) positively
in section 5. Lastly, section 6 presents conclusions, influences the adoption of technology (TA) in
implications and shortcomings of the study. auditing practices by auditors.

Vol. 1 Issue 1 ICAI Garuda 45

 H2A: Knowledge of technology (KT) positively effectiveness (Tsai et al., 2015), generate
influences auditing practices (AP) by auditors. more revenue for firms doing audit (Banker
et al., 2002) and enable independent
2.2. Influence of ease of use (EOU) of technology on examination of computer-stored client
the adoption of technology (TA) and auditing data by auditors (Smidt et al., 2021).Top of
practices (AP) by auditors Form On the basis of previous reviews, the
Davis (1989) defined, “perceived ease of use fifth and sixth hypotheses of the study are:
as the degree to which a potential user finds H5A: Perceived benefits of technology (PBT)
the adoption of a particular technology to be positively influences the adoption of technology
free of effort and significantly simpler and (TA) in auditing practices by auditors.
more enjoyable to use” and Betti & Sarens
(2021) view it as “the extent to which a person H6A: Perceived benefits of technology (PBT)
believes that using an IT will enhance his positively influences auditing practices (AP)
or her job performance.” Damerji & Salimi by auditors.
(2021) and Thottoli et al. (2022) discussed
that software enabled by technology is more 2.4. Influence of technology challenges (TC) on
likely to be adopted by firms when it is easy the adoption of technology (TA) and auditing
to use it. Thottoli (2021) revealed that audit practices (AP) by auditors
software empowered by technology tools Mostly, auditors complete their financial
can facilitate timely auditing of financial statements (FS) by the end of the fiscal year.
statements. In view of these studies, the third They face tight deadlines in completion
and fourth hypotheses are: of their tasks which require them to be
H3A: Ease of Use (EOU) of technology vigilant, ensuring precision and reliability of
positively influences the adoption of technology FS despite limited time available (Thottoli
(TA) in auditing practices by auditors. et al., 2022). Chou (2015), in his study,
highlights cloud computing risk and audit
H4A: Ease of Use (EOU) of technology matters, emphasizing the significance
positively influences auditing practices (AP) of addressing security concerns in cloud
by auditors. environments. Widuri et al., (2016) in their
study discuss that challenges like the scarcity
2.3. Influence of perceived benefits of technology of technically skilled auditors, expectations
(PBT) on the adoption of technology (TA) and and the lack of ‘Generalized Audit Software’
auditing practices (AP) by auditors (GAS) availability in multiple languages
Davis (1989) defined, “perceived usefulness influence the TA in AP. Similarly, Tijani
(or benefits) as the degree to which an (2014) reveals that due to technological
individual believes that using a particular challenges, the features and functions of
system would enhance his or her job audit software have grown increasingly
performance” and Venkatesh et al., (2003) complex, leading to limited usage among
also found in their study that performance auditors. Therefore, the seventh and eighth
expectancy is similar to perceived benefits, hypotheses of the study are:
explaining it as “the degree to which an H7A: Technology challenges (TC) positively
individual believes that using the tool will influence the adoption of technology (TA) in
help him or her better attain significant auditing practices by auditors.
rewards”. Al-Ateeq et al., (2022) indicates
that when auditors perceive the usefulness of H8A: Technology challenges (TC) positively
technology, it directly improves their audit influence auditing practices (AP) by auditors.
quality without even using the same. Audit
software and technology adoption ensure 2.5. Adoption of technology (TA) and auditing
timely completion of audit task (Mustapha practices (AP) by auditors
& Lai, 2017), enhance audit report quality Previous literature on the TA tools and
(Omonuk & Oni, 2015), improve internal techniques has found that usage of new
audit department performance (Al-Hiyari software enhances the efficiency and
et al., 2019), enhance internal audit productivity of auditors (Almagrashi et al.,

46 ICAI Garuda Issue 1 Vol. 1

 2023; Thottoli et al., 2022; Mazza & Azzali, Figure 1: Proposed conceptual model
2016), supports various audit assignments
and reduces audit task burden (Pedrosa et al.,
2019). Thus, the final hypothesis is:
H9A: Adoption of technology (TA) positively
influences auditing practices (AP) by auditors.

3. Conceptual framework development

The present study combines two models i.e., the
Innovation Diffusion Theory (IDT) developed by
Rogers (1976) and the Technology Acceptance
Model (TAM) introduced by Davis (1989).
Together, these models assess an individual's attitude
toward adopting and utilizing new technologies.
Additionally, previous literature supports the
adoption of these two theories in predicting
individual intention to adopt technology (Ma &
Liu, 2004; Damerji & Salimi 2021; Al-Ateeq et Source: Proposed by Author
Figure 1: Proposed conceptual model
al., 2022; Handoko, et al., 2023). In the current
model, two components from IDT- knowledge of was prepared through
Source: Proposed Google Forms and
by Author
technology (KT) and technology challenges (TC) distributed through Whatsapp groups
and two components from the TAM framework 4. Research methodologyof Chartered Accountants (CAs). The
- ease of use (EOU) and perceived benefits of questionnaire consisted of three sections.
technology (PBT) have been employed and their 4.1. Research design Section A contained questions related to

influence on the adoption and usage of technology Following Kesmodel, demographic information
U.S. (2018) findings, (Type
cross section research of wasfirm,
design used which is
in auditing practice has been studied. The proposed gender, location, experience); Section
considered as an appropriate technique for studying relationship between constructs at a
conceptual model (Figure 1), aims to explore the B contained statements related to the
influence of determinants of technology and particular
its point of time.measurement of technology related factors

adoption by auditors in auditing practice in NCR, i.e. KT, EOU, PBT, TC and TA, and the last
India. section contained statements related to the
4.2. Target Population and sampling
measurement of the AP construct.
4. Research methodology
As we all know, auditors always remain busy
4.1. Research design
in fulfilling their deadlines and audit work.
Following Kesmodel, U.S. (2018) findings, a Therefore, auditors who showed interest in
cross-section research design was used, which the survey were approached. Approximately,
is considered as an appropriate technique for 300 CAs were contacted. Out of the collected
studying the relationship between constructs responses, 54 were omitted due to incomplete
at a particular point of time. questionnaires. Therefore, after validation of
4.2. Target Population and sampling data, 246 (82%) responses were received. Table
To fulfill the objectives, the present paper II shows the KMO measure of sample adequacy
includes auditors practicing in small and value, which is equal to 0.872 (i.e., more than
medium sole proprietorships or partnership 0.60) and Bartlett’s test of sphericity is also
firms in NCR, India. A questionnaire significant (p =.000 which is <.05).

Table II: KMO and Bartlett's test

‘KMO Measure of Sampling Adequacy’ .872
‘Bartlett's Test of Sphericity’ Approx. Chi-Square 2148.777
Df 351
Sig. .000
Source: Author’s Calculation

Vol. 1 Issue 1 ICAI Garuda 47

 4.3. Measurement of variables related to these variables. The factor loadings
of 8 statements related to EOU3, EOU5,
Following the study of Thottoli et al. (2020) PBT1, TC6, TC7, TA4, TA5 and AP1 were
and Thottoli et al. (2022), six constructs were less than 0.5. Thus, these statements were
measured. A total of 35 statements were not taken into consideration for analysis. The
taken, which included 7 statements on KT, 5 loadings of all the remaining 27 statements
statements on EOU, 5 statements on PBT, 7 were greater than 0.50 (Table III). To test the
statements on TC, 5 statements on TA and 6 convergent validity, the composite reliability
statements on AP. (CR) value should be more than 0.7 and the
value of average variance explained (AVE)
A 5-point Likert scale with statements from
should be more than 0.5 (Hair et al., 2010).
5 (strongly agree) to 1 (strongly disagree) was
Lastly, CR > AVE. The CR coefficients
employed.
range between 0.725 and 0.9074, and AVE
4.4. Reliability and validity tests range from 0.463 to 0.603, outperforming
the limit estimation of 0.50, except in the
The present study was carried out between case of technology adoption and auditing
March, 2024 and April, 2024. In order practices construct (Table III). The AVE of
to check the reliability and validity of the these constructs is slightly less than 0.50,
questionnaire, CFA was used. It enables one thus, they are considered. All values of CR are
to make sense if a relationship exists between greater than AVE. Thus, all the conditions for
various observed variables and the statements convergent validity are fulfilled.
Table III. Confirmatory factor analysis (Measurement model)
Construct Variables Standardized loadings CR AVE
KT1 .812
KT2 .781
KT3 .751
Knowledge of
KT4 .746 0.9058 0.580
Technology (KT)
KT5 .866
KT6 .703
KT7 .656
EOU1 .727
Ease of Use of
EOU2 .831 0.8198 0.603
Technology (EOU)
EOU4 .769
PBT2 .726
Perceived Benefits of PBT3 .738
0.8488 0.50
Technology (PBT) PBT4 .715
PBT5 .640
TC1 .827
TC2 .723
Technology
TC3 .614 0.9074 0.561
Challenges (TC)
TC4 .803
TC5 .760
TA1 .689
Adoption of
TA2 .687 0.725 0.468
Technology (TA)
TA3 .676
Auditing Practices AP2 .683 0.8155 0.463
(AP) AP3 .699
AP4 .613
AP5 .722
AP6 .796
Source: Author’s Calculation

48 ICAI Garuda Issue 1 Vol. 1

Discriminant validity (DV) is met when the square root Multicollinearity was also checked using the variance
of AVE exceeds its correlation with any other latent inflation factor (VIF). Table V shows the absence of
variable, as suggested by Fornell and Larcker (1981). this issue among variables, with values ranging between
Table IV indicates that DV is met. 1.696 and 2.960; and hence, they fall within the range
suggested by Hair et al. (2014) i.e., less than 5.
Table IV. Discriminant validity
Table V: VIF values
KT EOU PBT TC TA AP
Constructs VIF value
KT .7615
KT 1.696
EOU 1.868
EOU .529** .7765
PBT 1.965
TC 1.806
PBT .570** .563** .7071
TA 2.960
Source: Author’s Calculation
TC .308** .250** .382** .7489
4.5. Common Method Bias (CMB) test
Harman’s Single-Factor Test is used for
TA .535** .588** .619** .648** .6841 CMB. This model employs EFA to determine
the percentage of variance explained by the
first factor. Table VI shows that the first factor
AP .572** .443** .586** .366** .538** .6804 explains 39.649% of the variance, which is
less than 50% (Harman, 1976) i.e., the data is
Source: Author’s Calculation viewed to be free from CMB.
Table VI. CMB test

Total variance explained

Factor Initial eigen values Extraction sums of squared loadings
Total % of Cumulative Total % of Cumulative
Variance % Variance %
1 10.705 39.649 39.649 10.705 39.649 39.649
2 2.650 9.814 49.463 2.650 9.814 49.463
3 1.784 6.606 56.069 1.784 6.606 56.069
4 1.745 6.462 62.531 1.745 6.462 62.531
5 1.428 5.290 67.821 1.428 5.290 67.821
6 1.000 3.706 71.527 1.000 3.706 71.527
7 .794 2.942 74.469
8 .725 2.686 77.154
9 .667 2.471 79.625
10 .612 2.267 81.892
11 .552 2.045 83.937

Vol. 1 Issue 1 ICAI Garuda 49

 Total variance explained
Factor Initial eigen values Extraction sums of squared loadings
Total % of Cumulative Total % of Cumulative
Variance % Variance %
12 .511 1.891 85.829
13 .439 1.625 87.454
14 .411 1.522 88.976
15 .400 1.480 90.456
16 .369 1.367 91.823
17 .308 1.139 92.963
18 .293 1.086 94.049
19 .271 1.005 95.053
20 .266 .985 96.038
21 .217 .805 96.842
22 .207 .768 97.610
23 .175 .650 98.259
24 .161 .594 98.854
25 .123 .454 99.308
26 .098 .362 99.670
27 .089 .330 100.000
28 10.705 39.649 39.649
Extraction Method: Principal Component Analysis
Source: Author’s Calculation

5. Findings and Discussion 5.2. Influence of ease of use (EOU) of technology on

5.1 Influence of knowledge of technology (KT) on the adoption of technology (TA) and auditing
the adoption of technology (TA) and auditing practices (AP) by auditors
practices (AP) by auditors The regression results (Table VII and Figure
Table VII and Figure 2 demonstrate the 2) suggest that EOU is a significant predictor
noteworthy and optimistic impact of KT of TA (β =0.51, p < .05 i.e. 0.000), therefore,
on the TA by auditors (β =0.51, p < .05 i.e. the findings are also in support of H3A.
0.000) and on AP (β =0.38, p < .05 i.e. 0.006). The outcomes are consistent with previous
Thus, the results are in the support of H1A and findings of Damerji & Salimi (2021);
H2A. It indicates that KT enhances the TA Thottoli et al. (2022) and Almagrashi et al.,
in auditing practices and improves internal (2023). However, results show insignificant
audit quality (Alqudah et al., 2019). The association between EOU and AP (β =0.13,
results are in conformity with the findings of p < 0.05 i.e. 0.297). Thus, H4A is not
Lutfi & Alqudah, (2023); Thottoli (2021) and supported in this study. These results conflict
Supriadi et al., (2019). with the findings of Thottoli et al. (2022)

50 ICAI Garuda Issue 1 Vol. 1

 who state that EOU of technology enhances in this study. Results are not in conformity
the effectiveness of audit work. with Widuri et al. (2016) findings who
contend that the TA by audtiors is necessary
5.3. Influence of perceived benefits of technology to address the complexities associated with
(PBT) on the adoption of technology (TA) and auditing financial statements. Similarly,
auditing practices (AP) by auditors Omoteso (2016) also asserts that auditors
The results (Table VII and Figure 2) also show should use technology tools to improve audit
a significant association between PBT and TA quality in response to emerging challenges.
(β =0.17, p < 0.10 i.e. 0.070) and between PBT Furthermore, Thottoli et al. (2022) believe
and AP (β =0.39, p < 0.05 i.e. 0.000). So, H5A that young auditors are more inclined to
and H6A are supported in the current study. embrace technological challenges positively
The findings of the current study align with in audit practice.
Razi and Madani, (2013); Al-Ateeq et al.,
5.5. Adoption of technology (TA) and auditing
(2022) who demonstrate perceived benefits
practices (AP) by auditors
as an influential factor in the adoption of
technology. However, Thottoli et al. (2022) Lastly, Table VII and Figure 2 reveal a weak
found a negative association between PBT association between TA and AP (β =0.11, p <
and AP and do not support the present study. .05 i.e. 0.025). Thus, H9A holds up in this study.
The results are in support with the findings of
5.4. Influence of technology challenges (TC) on
Razi and Madani, (2013); Mazza & Azzali,
the adoption of technology (TA) and auditing
(2016); Thottoli et al. (2022); Almagrashi et
practices (AP) by auditors
al., (2023). This significant association can be
The current study results (Table VII and because the traditional method of auditing
Figure 2) show an insignificant link between practices may not fit in today’s advanced
TC and TA by auditors (β =0.12, p > .05 technological environment, prompting firms
i.e. 0.501) and an insignificant association to adopt technology tools in auditing practices
between TC and AP (β =0.12, p > .05 i.e. which enhances speed, accuracy, productivity
0.200). So, H7A and H8A are not sustained and efficiency.

Table VII: Path coefficients

Hypotheses Path coefficient p value Result

TA <--- KT 0.51 *** Accepted
TA <--- PBT 0.17 0.070 Accepted
TA <--- TC 0.12 0.501 Rejected
TA <--- EOU 0.51 *** Accepted
AP <--- KT 0.38 0.006 Accepted
AP <--- PBT 0.39 *** Accepted
AP <--- TC 0.12 0.200 Rejected
AP <--- EOU 0.13 0.297 Rejected
AP <--- TA 0.11 0.025 Accepted
Source: Author’s Calculation
Notes: Significant levels p< .05, p<.10
Table VIII. Overall structural equation model (SEM)

Model CMIN/df GFI RMSEA

Proposed 1.958 0.918 0.07
Source: Author’s Calculation

Vol. 1 Issue 1 ICAI Garuda 51

Table IX: Model summary
Model R R Square Std. Error of the Estimate
1 .672a .452 .56074
a Predictors: (Constant), TA, KT, EOU, TC, PBT
Source: Author’s Calculation
Table VIII shows that the fit index GFI =0.918, CMIN/
df= 1.958, REMSEA= 0.07 is also within acceptable
range. Finally, the projected model is good.
Table IX shows the combined influence of independent
variables (KT, EOU, PBT, TC and TA) on AP i.e.,
45.2% (R square value). This shows that technology
factors taken together in the proposed model do impact
AP.

6. Conclusion, implications and shortcomings

of the study
6.1. Demographic profile of auditors
Table X shows that the majority of the
auditors, i.e., 71.9%, are male, while 28.1%
are female. Among the auditors, 66.2% have
less than 10 years of experience in auditing,
followed by 10-20 years’ experience group
at 22.4%, and lastly, 11.4% have more
than 20 years of experience in auditing.
Additionally, the majority of auditors have
Figure 2: Impact of technology related factors on sole proprietorship firms, i.e., 50.9%, followed
technology adoption and auditing practices by closely by partnership firms or LLPs at 49.1%.
auditors in India
Table X: Demographic profile of auditors
Demographic Profile Frequency Percentage (%)
Type of audit firm
Sole proprietorship 125 50.9%
Partnership firm or LLP 121 49.1%
Experience in auditing
0-10 years 163 66.2%
10-20 years 55 22.4%
More than 20 years 28 11.4%
Gender of auditor
Male 177 71.9%
Female 69 28.1%
Source: Author’s Calculation
6.2. Conclusion Results reveal that KT, EOU of technology,
and PBT have significant influence on TA
The majority of previous research on the in auditing practices. The findings reveal
adoption of technology in auditing practices that KT, EOU, and PBT emerge as strong
has been conducted outside India, with determinants affecting TA tools in auditing
fewer studies conducted within India. This practice by auditors in India. The findings
study presents a unique and new technology indicate that knowledge of technology
adoption model in auditing practices in India. enhances the effectiveness of auditing,

52 ICAI Garuda Issue 1 Vol. 1

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Author may be reached at
Communication Technology Competency Among Auditing
garimahgc13@gmail.com
Professionals. Accounting. Analysis. Auditing, 8(2), 38–47.
and irj@icai.in
https://doi.org/10.26794/2408-9303-2021-8-2-38-47

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