Auditors, Specialists, and Professional Jurisdiction in Audits of Fair Values

Posted: 20 Jun 2019

Multiple version iconThere are 2 versions of this paper

Date Written: February 19, 2019


Auditors frequently use valuation specialists to help them evaluate fair values, but researchers and regulators know little about how auditors use these specialists. Based on interviews with 28 auditors and 14 valuation specialists, I develop a theoretical framework informed by expert systems and professional competition theories. The interviews suggest that institutional pressures in the fair value environment unevenly impact auditors and specialists, causing tension between auditors’ needs for ontological security and jurisdictional claims. This tension leads to one-sided competition between auditors and specialists and incomplete acceptance of specialists’ work. Auditors’ competitive behaviors coupled with this incomplete acceptance result in a tendency to make specialists’ work conform to auditors’ views. Collectively, these findings suggest that auditors use specialists as an institutional mechanism to create comfort, but not insight. This study links expert systems and professional competition theories, and it provides critical insight into some assumptions underlying tenets of each theory. It also informs researchers, regulators, and practitioners interested in understanding and addressing problems related to the use of specialists.

Keywords: Accounting estimates, Auditing, Fair value, Professions, Specialist

JEL Classification: M40, M41, M42

Suggested Citation

Griffith, Emily Elaine, Auditors, Specialists, and Professional Jurisdiction in Audits of Fair Values (February 19, 2019). Contemporary Accounting Research, Forthcoming, Available at SSRN:

Emily Elaine Griffith (Contact Author)

University of Wisconsin - Madison ( email )

School of Business
975 University Avenue
Madison, WI 53706
United States

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