The first objective of the current study is to examine the extent to which financial auditors recognize heightened risks associated with an enterprise resource planning (ERP) system, as compared to non-ERP (legacy) system, in the presence of a control weakness over access privileges. The second...

Although skepticism is widely viewed as essential to audit quality, there is a debate about what form is optimal. The two prevailing perspectives that have surfaced are ‘neutrality’ and ‘presumptive doubt’. With neutrality, auditors neither believe nor disbelieve client management. With...

In this study we examine the effect of auditor economic bonding (financial dependency on a client) on audit quality. We consider financial dependency as either abnormally high fees in relation to expected hours or vice versa. We consider audits to have credence goods properties where the client...

We examine the joint effects of the reporting threshold (more than remote versus reasonably possible) and type of control deficiency (entity level versus account specific) described in the adverse report on internal controls on equity analysts' evaluation of the reliability of a company's future...

Calls from practice suggest that audit committee members with industry expertise can improve audit committee effectiveness. Nevertheless, regulators and extant literature have focused on the financial expertise of the audit committee. We posit that audit committee industry knowledge is valuable...