Understanding Audit Quality: Insights from Audit Professionals and Investors

• 成果类型: Article
• 署名作者: Christensen, Brant E.; Glover, Steven M.; Omer, Thomas C.; Shelley, Marjorie K.
• 署名单位: University of Missouri System; University of Missouri Columbia; Brigham Young University; University of Nebraska System; University of Nebraska Lincoln
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1111/1911-3846.12212
• 发表日期: 2016
• 页码: 1648-1684
• 关键词: industry specialization; nonaudit services; fee pressure; big 4; earnings; perceptions; INDEPENDENCE; FRAMEWORK; proxies; TENURE

摘要

Projects seeking to define, measure, and evaluate audit quality are on the agendas of auditing standards setters as well as audit firms. The Public Company Accounting Oversight Board (PCAOB) currently provides information regarding audit quality through the release of inspection reports, and the Board intends to establish and report audit quality indicators. To provide additional perspective on audit quality, we obtain auditors' and investors' views, definitions, and indicators of audit quality. We find that investors' definitions of audit quality focus more on inputs to the audit process than do auditors', and that investors view the number of PCAOB deficiencies as an indicator of overall firm quality. We find a consensus that auditor characteristics may be the most important determinants of audit quality, and that restatements may be the most readily available signal of low audit quality. We relate responses to a general audit quality framework, provide support for archival audit research, and identify additional disclosures that participants suggest could signal audit quality. Taken together, we provide evidence regarding the construct of audit quality in the post-SOX environment, evaluate many of the audit quality indicators proposed by the PCAOB, and suggest avenues for future research.