External auditors’ reliance on management’s experts: evidence from Australia

Research output: ThesisDoctoral Thesis

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Abstract

Concerns raised by the Australian regulator about auditors' over-reliance on management's experts (MEs) call for an understanding of factors that may influence auditors' reliance decisions and cause observed audit deficiencies. Interviews with auditors indicate that MEs' perceived cognitive authority status, auditors' role in the selection of MEs, auditors' pre-engagement conversation with MEs, regularity of a task and an ME-firm's reputation could cause an unintended negative impact on audit quality. A follow on experimental study further suggests that the adverse impact of a pre-engagement conversation on audit quality is likely to be evident, particularly in contentious auditor-client relationships.
Original languageEnglish
QualificationDoctor of Philosophy
Awarding Institution
  • The University of Western Australia
Supervisors/Advisors
  • Da Silva Rosa, Raymond, Supervisor
  • Woodliff, David, Supervisor
  • Tarca, Ann, Supervisor
Thesis sponsors
Award date21 May 2018
DOIs
Publication statusUnpublished - 2018

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Auditors
External auditor
Audit quality
Regularity
Firm reputation
Factors
Experimental study
Audit
Authority

Cite this

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title = "External auditors’ reliance on management’s experts: evidence from Australia",
abstract = "Concerns raised by the Australian regulator about auditors' over-reliance on management's experts (MEs) call for an understanding of factors that may influence auditors' reliance decisions and cause observed audit deficiencies. Interviews with auditors indicate that MEs' perceived cognitive authority status, auditors' role in the selection of MEs, auditors' pre-engagement conversation with MEs, regularity of a task and an ME-firm's reputation could cause an unintended negative impact on audit quality. A follow on experimental study further suggests that the adverse impact of a pre-engagement conversation on audit quality is likely to be evident, particularly in contentious auditor-client relationships.",
keywords = "External auditors' judgment and decision making, Auditors' judgment and decision making, Inconsistent audit evidence, Auditor-client relationship",
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school = "The University of Western Australia",

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AB - Concerns raised by the Australian regulator about auditors' over-reliance on management's experts (MEs) call for an understanding of factors that may influence auditors' reliance decisions and cause observed audit deficiencies. Interviews with auditors indicate that MEs' perceived cognitive authority status, auditors' role in the selection of MEs, auditors' pre-engagement conversation with MEs, regularity of a task and an ME-firm's reputation could cause an unintended negative impact on audit quality. A follow on experimental study further suggests that the adverse impact of a pre-engagement conversation on audit quality is likely to be evident, particularly in contentious auditor-client relationships.

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