The Role of Internal Audit to Reduce the Effects of Creative Accounting on the Reliability of Financial Statements in the Jordanian Islamic Banks

Round 1

Reviewer 1 Report

Dear authors

Please address the following comments:

1. Provide a full definition of acronyms upon the first use. Check the whole paper.

2. In the introduction, the theoretical issue is not clear. Please elaborate on that.

3. The methodology needs major improvements. You need to explain the following:

3.1. How data collection process was conducted?

3.2. What was the sampling technique used?

3.3. Explain how the survey was developed, and provide the measurement items used.

3.4. How was the survey was pretested?

3.5. What was the analysis tool used? Why?

4. Results also need to be improved.

4.1. The HTMT assessment of discriminant validity is important but missing in the analysis reported. Please add it.

4.2. Compare the results obtained with the results of previous studies.

5. Implications of the study to theory and practice are missing. Please explain this in a separate section.

6. Limitations and future directions are also not included.

Author Response

Cover letter

Dear Reviewer: We appreciate you reading this manuscript and making some insightful recommendations. Where it has been altered in accordance with the report you've attached.
- The purpose of this manuscript is to look into the role of internal audit (IA) in reducing the effects of creative accounting (CA) on financial statement reliability in Jordanian Islamic Banks. 
- As a result, the study's contribution is to determine the nature of these procedures and the amount to which internal auditors might use audit processes to weaken these methods in order to gain confidence in the financial statements contained in the financial statements.
- Despite making some significant contributions, this manuscript has certain drawbacks. As a result, admitting these limitations helps the credibility of the current research findings. This study focuses on the variables stated in the conceptual design, with the goal of maintaining a balanced perspective in the diagnostic and interactive usage of the model in Jordanian Islamic banks.
- The questionnaire was employed as a data collection method in the study to represent the perspectives of the chosen sample. To meet the nature of the current investigation, a self-administered questionnaire was chosen as the survey instrument, as a regularly used approach for data collecting in the survey study. The researchers used the Five-scale Likert measures to design and improve the questionnaire and collect data in order to achieve the study objectives.
- The results showed that there is a role for IA (Including independence objectivity, verifiability, professional care, and impartiality) in limiting the effects of CA on the Reliability of financial statements in Jordanian Islamic Banks.
 - Furthermore, the current manuscript recommends paying attention to activating the role of internal audit within banks because of its positive impact on adding value, improving operational effectiveness, and achieving goals, which contributes to limiting the use of any methods that would jeopardize the bank's reputation. As a result, the current work might serve as a foundation for future research to improve field knowledge.
Best Regards.
Dr. Baker Jarah
Faculty of Business, Amman Arab University, Amman Jordan.

Reviewer 2 Report

Dear authors,

Thank you very much for sending your paper to the journal. I have the following concerns which should be addressed in the next version:

1- What is the originality of the paper? You did not mention the originality

2- What is the research gap? You mentioned several related studies without coming to the research gap.  So, this part should be highlighted on the paper.

3-Please improve the theoretical issues and literature with the most recent studies.

4- It is also recommended to conduct a robustness test to validate the main findings of the study

Author Response

Cover letter

Dear Reviewer: We appreciate you reading this manuscript and making some insightful recommendations. Where it has been altered in accordance with the report you've attached.
- The purpose of this manuscript is to look into the role of internal audit (IA) in reducing the effects of creative accounting (CA) on financial statement reliability in Jordanian Islamic Banks. 
- As a result, the study's contribution is to determine the nature of these procedures and the amount to which internal auditors might use audit processes to weaken these methods in order to gain confidence in the financial statements contained in the financial statements.
- Despite making some significant contributions, this manuscript has certain drawbacks. As a result, admitting these limitations helps the credibility of the current research findings. This study focuses on the variables stated in the conceptual design, with the goal of maintaining a balanced perspective in the diagnostic and interactive usage of the model in Jordanian Islamic banks.
- The questionnaire was employed as a data collection method in the study to represent the perspectives of the chosen sample. To meet the nature of the current investigation, a self-administered questionnaire was chosen as the survey instrument, as a regularly used approach for data collecting in the survey study. The researchers used the Five-scale Likert measures to design and improve the questionnaire and collect data in order to achieve the study objectives.
- The results showed that there is a role for IA (Including independence objectivity, verifiability, professional care, and impartiality) in limiting the effects of CA on the Reliability of financial statements in Jordanian Islamic Banks.
 - Furthermore, the current manuscript recommends paying attention to activating the role of internal audit within banks because of its positive impact on adding value, improving operational effectiveness, and achieving goals, which contributes to limiting the use of any methods that would jeopardize the bank's reputation. As a result, the current work might serve as a foundation for future research to improve field knowledge.
Best Regards.
Dr. Baker Jarah
Faculty of Business, Amman Arab University, Amman Jordan.

Round 2

Reviewer 1 Report

Dear authors

You have not incorporated comments given in the previous review round. I am giving you another chance to improve your work. Otherwise, I may reject it. Please provide a point-by-point response to all comments given.

1. In the introduction, the theoretical issue is not clear. Please elaborate on that.

3. The methodology needs major improvements. You need to explain the following:

3.1. How data collection process was conducted?

3.2. What was the sampling technique used?

3.3. Explain how the survey was developed, and provide the measurement items used.

3.4. How was the survey was pretested?

3.5. What was the analysis tool used? Why?

4. Results also need to be improved.

The HTMT assessment of discriminant validity is important but missing in the analysis reported. Please add it.

5. Explain the implications of the study in a separate section. 

Author Response

Dear Reviewer
Thank you for giving me the opportunity to adjust the manuscript.
Where all comments have been corrected. You can find it in the attached report.

Author Response File: Author Response.pdf

Reviewer 2 Report

Dear author,

Thank you very much for sending your revised paper. As I looked at the current version you did not address all my comments in the current version. You reply in the response letter. I asked you to highlight the originality of the paper in the main text etc., Even I asked you to conduct additional analyses. You did nothing about my comments. Please have a look at my previous comments and incorporate step by step

Author Response

Dear Reviewer
Thank you for giving me the opportunity to adjust the manuscript.
Where all comments have been corrected. You can find it in the attached report.

Author Response File: Author Response.pdf

Round 3

Reviewer 1 Report

The research methodology has not yet been improved.

1. How data collection process was conducted?

2. What was the sampling technique used?

3. Explain how the survey was developed, and provide the measurement items used.

4. How was the survey was pretested?

Author Response

Dear Reviewer
The methodology has been rewritten according to the report attached by you. You can find the addition in the attached report. It was also added to the manuscript. You can find them in the attached report.

Author Response File: Author Response.pdf

Reviewer 2 Report

Dear authors,

Thank you very much for sending your revised paper. However, the paper still needs some revision as follows:

1- The theoretical issues and literature section needs to include the most recent studies as follows:

-The Moderating Impact of the Audit Committee on Creative
Accounting Determination and Financial Reporting Quality in
Iraqi Commercial Banks

-Internal Audit and Creative Accounting Practices in Ministries, Departments and Agencies (MDAs): An Empirical Analysis

-Does intellectual capital and corporate governance have an impact on annual report readability? Evidence from an emerging market

-The relationship between intellectual capital and financial statements readability: the role of management characteristics

-The relationship between management attributes and accounting comparability

Author Response

Dear Reviewer
The references recommended by you have been added. You can find them in the attached report.

Author Response File: Author Response.pdf