This study investigates the audit firm's decision to protect its partners' personal assets by becoming a limited liability partnership (LLP). We find that the likelihood of an audit firm switching from unlimited to limited liability is increasing in its size and exposure to litigation risk. We...

AICPA Ethics Interpretation 501-8 permits the use of limitation of liability clauses in jurisdictions where they are allowed (AICPA 2013). This study advances Brandon and Mueller's (2006) research to examine the impact of auditor reputation on jurors' perceptions of auditor liability when the...