DescriptionThis dissertation consists of three essays that examine the effects of emerging technologies in accounting. The first essay examines whether firms abuse XBRL extension elements to increase the complexity of their mandatory filings in interactive data format. Using the ratio of extension elements to total elements in XBRL 10-K filings as the measure of XBRL complexity, this study finds that firms’ XBRL filings are more complex when the firms are performing poorly, suggesting that managers use extension elements strategically to increase XBRL complexity and obfuscate XBRL-tagged financial information.
The second essay investigates whether the adoption of the XBRL affects firms’ capital investment efficiency due to the increased information processing efficiency. The findings of this essay suggest that the adoption of XBRL reduces the levels of abnormal investments. Additionally, the benefits of XBRL mandate on investment efficiency are more evident for firms with weaker external monitoring, severer environmental uncertainty, and more readable financial reports.
The third essay introduces robotic process automation (RPA) to the auditing area. A framework is proposed to apply RPA to audit procedures in order to free auditors from doing repetitive and low-judgment audit tasks and enable them to focus on audit tasks that require professional judgment. This essay also demonstrates the feasibility of RPA by implementing a pilot project that applies RPA to the confirmation process.
In conclusion, this dissertation examines the effects of XBRL on financial reporting strategy and managers’ investment decision, proposes a framework to apply RPA to automate labor-intensive, well-defined, and repetitive audit procedures, and demonstrate the feasibility in the audit practice.