The Ties that Bind: Knowledge-Seeking Networks and Auditor Job Performance

49 Pages Posted: 12 Dec 2017 Last revised: 27 Jan 2021

See all articles by Monika Causholli

Monika Causholli

University of Kentucky - Von Allmen School of Accountancy

Theresa Floyd

University of Montana - Department of Management and Marketing

Nicole Thorne Jenkins

University of Virginia - McIntire School of Commerce

Scott Soltis

University of Kentucky - School of Management

Date Written: January 26, 2021

Abstract

The dissemination of knowledge in audit firms is a critical process that has gone relatively unexamined by researchers. Using social network analysis to quantify the knowledge-seeking networks in a Big 4 audit firm in the U.S., we examine the association between the types and patterns of knowledge-seeking ties and individual auditor performance. Our initial finding is that auditor job performance is negatively associated with the number of knowledge-seeking ties. Further, our analyses demonstrate that this negative association is being driven by explicit knowledge-seeking rather than tacit knowledge-seeking activities and is stronger for higher-ranked auditors. Thus, knowledge-seeking by auditors may come at a cost, particularly when that knowledge is codifiable and when the seeking is done by those at higher levels of the firm. In a post-hoc analysis, we find that tacit knowledge-seeking ties to managers can be beneficial for auditor performance, and tacit knowledge-seeking ties to senior managers and partners is sometimes detrimental. In sum, this suggests that who is seeking knowledge and who is being sought for knowledge are both important for performance. Our findings may assist researchers to better understand how auditors leverage their social connections to learn, which in turn may affect audit efficiency and effectiveness. Further, audit firms might benefit from better understanding the consequences of knowledge-seeking from different sources and use this understanding to make decisions that maximize desirable information flows.

Keywords: Social Networks, Knowledge-Seeking, Auditor Performance

JEL Classification: M42

Suggested Citation

Causholli, Monika and Floyd, Theresa and Jenkins, Nicole Thorne and Soltis, Scott, The Ties that Bind: Knowledge-Seeking Networks and Auditor Job Performance (January 26, 2021). Accounting, Organizations and Society, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3084942 or http://dx.doi.org/10.2139/ssrn.3084942

Monika Causholli (Contact Author)

University of Kentucky - Von Allmen School of Accountancy ( email )

Lexington, KY 40506
United States

Theresa Floyd

University of Montana - Department of Management and Marketing ( email )

Missoula, MT 59812
United States

Nicole Thorne Jenkins

University of Virginia - McIntire School of Commerce ( email )

P.O. Box 400173
Charlottesville, VA 22904-4173
United States

HOME PAGE: http://https://www.commerce.virginia.edu/faculty/nt4jw

Scott Soltis

University of Kentucky - School of Management ( email )

Lexington, KY 40546
United States

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