Auditors’ Joint Engagements and Audit Quality: Evidence from Italian Private Companies

51 Pages Posted: 18 Sep 2015 Last revised: 10 Feb 2019

See all articles by Pietro A. Bianchi

Pietro A. Bianchi

Florida International University (FIU)

Date Written: May 22, 2017

Abstract

This study examines the effect of auditors’ collaboration in joint audit engagements on knowledge transfer, auditor expertise, and audit outcomes. I employ a unique sample of Italian private companies whose financial statements are jointly audited by three individual auditors and use measures from the network literature to capture the intensity of interactions between these auditors. I find a positive association between several audit quality proxies and auditors’ collaboration in multiple joint engagements. My results suggest that auditors develop knowledge and contacts through collaboration which potentially leads to higher audit quality. Overall, my findings suggest that joint engagements facilitate knowledge transfer and increase auditor expertise.

Keywords: audit quality; auditors’ collaboration; joint audit; social networks analysis

JEL Classification: M43, M49

Suggested Citation

Bianchi, Pietro A., Auditors’ Joint Engagements and Audit Quality: Evidence from Italian Private Companies (May 22, 2017). Contemporary Accounting Research (2018) 35(3): 1533-1577, Available at SSRN: https://ssrn.com/abstract=2661559 or http://dx.doi.org/10.2139/ssrn.2661559

Pietro A. Bianchi (Contact Author)

Florida International University (FIU) ( email )

University Park
11200 SW 8th Street
Miami, FL 33199
United States

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