The Informative Value of Key Audit Matters in the Audit Report: Understanding the Impact of the Audit Firm and KAM Type

Nicolás Gambetta, Laura Sierra‐García, María Antonia García‐Benau and Josefina Novejarque‐Civera

Australian Accounting Review, 2023, vol. 33, issue 2, 114-134

Abstract: This paper examines whether the readability (and hence informative value) of key audit matters (KAM) varies according to the audit firm and the KAM type disclosed, a question of vital importance for stakeholders, whose effective decision‐making depends on the quality of information received. Our analysis shows that the informative value of KAM matter and KAM audit procedures varies according to the audit firm responsible. This informative value also depends on whether the KAM is related to entity‐ or accounting‐level risks. This study contributes to the KAM and audit quality literature by showing how these factors impact on the informative value of the expanded audit report. Furthermore, in the context of the agency, institutional and self‐presentation theories and the real effects hypothesis, we discuss auditors’ incentives to increase or decrease the informative value of the expanded audit report.

Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://doi.org/10.1111/auar.12396

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:ausact:v:33:y:2023:i:2:p:114-134

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1035-6908

Access Statistics for this article

Australian Accounting Review is currently edited by Linda M. English

More articles in Australian Accounting Review from CPA Australia
Bibliographic data for series maintained by Wiley Content Delivery ().