The Difficult Client-Acceptance Decision in Canadian Audit Firms: A Field Investigation

Abstract:     
Auditing is often depicted in scientific as well as professional literature as a practice subject to conflicting influences, such as mechanisation vs. flexibility, and professionalism vs. commercialism. This paper examines how auditors actually make the client-acceptance decision in action, in the midst of these conflicting influences. The investigation was conducted via a field study at three Big Six firms located in Canada.

The results show that in all firms the decision processes are largely flexible, being characterised by a high degree of informal communications and the adaptation of the firm's rules and decision aids to circumstances. Furthermore, while commercialism exerts in one firm a significant influence on the decision processes, in the two other firms the decision processes are mostly consistent with professionalism. This finding seems to contradict the deprofessionalisation claims that are often made vis-a-vis the auditing profession within the academic literature: in the majority of the firms, professionalism appears to be significantly influential when auditors make client-acceptance decisions.

JEL Classifications: M49, D81

Working Paper Series