Auditor Skill Demands and Audit Quality: Evidence from Job Postings

58 Pages Posted: 6 Jan 2021

See all articles by Charles (Chad) Ham

Charles (Chad) Ham

Washington University in St. Louis - John M. Olin Business School

Rebecca N. Hann

University of Maryland - Robert H. Smith School of Business

MaryJane Rabier

Washington University in St. Louis

Wenfeng Wang

City University of Hong Kong

Date Written: October 12, 2020

Abstract

Using a novel dataset of online job postings by accounting firms, this study empirically examines audit offices’ skill preferences and whether they relate to audit quality. Consistent with prior work in labor economics, we find the demand for cognitive, social, and technology- related skills has increased over our sample period of 2007-2017. We also find substantial variation in the demand for these skills not only across audit firms, but also across offices within an audit firm, suggesting that audit offices are not homogeneous in their demand for auditor skills. Among the three skills, we find the demand for social skills has the strongest relation with audit quality. This association is stronger for large or industry specialist audit offices and for complex clients, suggesting the benefits of social skills are greater when effective coordination and knowledge transfer are crucial in achieving high-quality audits. Taken together, our findings suggest that an audit office’s skill preferences represent an important office attribute that can affect audit quality.

Suggested Citation

Ham, Charles and Hann, Rebecca N. and Rabier, MaryJane and Wang, Wenfeng, Auditor Skill Demands and Audit Quality: Evidence from Job Postings (October 12, 2020). Available at SSRN: https://ssrn.com/abstract=3727495 or http://dx.doi.org/10.2139/ssrn.3727495

Charles Ham (Contact Author)

Washington University in St. Louis - John M. Olin Business School ( email )

One Brookings Drive
Campus Box 1133
St. Louis, MO 63130-4899
United States

Rebecca N. Hann

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States

MaryJane Rabier

Washington University in St. Louis ( email )

One Brookings Drive
Campus Box 1208
Saint Louis, MO MO 63130-4899
United States

Wenfeng Wang

City University of Hong Kong ( email )

83 Tat Chee Avenue
Kowloon
Hong Kong

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