How Trial Preparation Factors Influence Audit Litigation Outcomes: Insights from Audit Litigators

• 成果类型: Article
• 署名作者: Maksymov, Eldar; Peecher, Mark E.; Pickerd, Jeffrey; Zhou, Yuepin (Daniel)
• 署名单位: Arizona State University; Arizona State University-Tempe; University of Illinois System; University of Illinois Urbana-Champaign; University of Mississippi
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/TAR-2021-0305
• 发表日期: 2024
• 页码: 373-396
• 关键词: liability regimes; culpable control; RISK; QUALITY; JURORS; fees; PSYCHOLOGY; management; increase; matter

摘要

Research indicates that auditors have an impoverished understanding of trial preparation factors that, independent of audit quality, can significantly elevate audit litigation risk. As the scholarly literature sheds little insight about the nature and implications of these factors, we identify what factors audit litigators consider in trial preparation, how they expect these factors to affect litigation outcomes, and how they attempt to leverage these factors. To do so, we interview 39 audit litigators, who identify factors germane to trial venues, jury pools, and case arguments. Guided by the elaboration likelihood model, we construct a framework that predicts these factors influence litigation outcomes by changing jurors' motivation and/or capability to elaborate. Importantly, we find that litigators who defend (sue) auditors strategically maneuver these factors to increase (decrease) the likelihood of higher juror elaboration, because higher elaboration is favorable to auditors. We discuss implications of our results for practice and research.