How do team workloads and team staffing affect the audit? Archival evidence from U.S. audits

Brant E. Christensen, Nathan J. Newton and Michael S. Wilkins

Accounting, Organizations and Society, 2021, vol. 92, issue C

Abstract: We use U.S. data from a global accounting firm to investigate how two key elements of audit teams –workloads and staffing continuity – affect the audit. We find that heavier team workloads are associated with lower audit quality, particularly when team members have lower performance ratings or have total workloads that exceed 60 h per week. In addition to finding evidence of employee burnout, we also document an incremental distraction effect. Specifically, we find that audit quality on the primary client suffers when team members spend more time during busy season on other concurrent clients. Regarding continuity, we find that greater year-over-year team staffing continuity is associated with improved audit quality, efficiency, and profitability. These effects are strongest when returning team members are highly rated or work in smaller audit offices. Finally, the effects of workload and continuity on audit quality at the team level are driven by audit seniors and audit staff, suggesting that offices should be particularly careful as they develop schedules for junior auditors. Overall, our study provides important new evidence about audit teams as called for by academics and regulators.

Keywords: Audit teams; Audit workload; Turnover; Audit quality; Audit effort (search for similar items in EconPapers)
JEL-codes: M41 M42 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:aosoci:v:92:y:2021:i:c:s0361368221000015

DOI: 10.1016/j.aos.2021.101225

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