Audit firm executives under pressure: A discursive analysis of legitimisation and resistance to reform

Michael Harber, Warren Maroun and Alan Duboisée de Ricquebourg

CRITICAL PERSPECTIVES ON ACCOUNTING, 2023, vol. 97, issue C

Abstract: The UK audit profession is facing a crisis of public trust and legitimacy following a series of high-profile audit failures. This resulted in the executive leadership of UK audit firms being summoned before a House of Commons Select Committee as part of its inquiry into ‘the future of audit’. During this inquiry the audit executives walked a tightrope, to both defend the social contract from an existential threat and attempt to influence policy reforms in their favour. This paper draws on ‘neutralisation techniques’ from deviance theory and the ‘grammar of legitimation’ from legitimacy theory to inform a discursive analysis of how auditors use strategic rhetoric to defend their professionalism and maintain their social contract to operate, all the while attempting to affect policy outcomes to align with their firms’ economic interests. Data for this study are drawn from the ‘oral evidence sessions’ and submitted ‘written evidence’ provided by the audit firm leadership. Our findings illustrate how the auditors construct a variety of strategic rationalisations, couched in moral ideals, to effectively deny responsibility for corporate financial scandals while simultaneously identifying with the ‘victims’ of audit failures and representing themselves ‘heroically’, as indispensable solution-bearers, not problem-causers. Their application of logic and language is cleverly designed to defend existing practices, neutralize the allegations of the inquiry, and provide the basis for advocating preferred policy outcomes. We show how, in this UK regulatory context, the Big Four are again successful in diluting and delaying reform, especially that which would legislate a full legal and economic split of their lucrative advisory service business from their audit business - a union which has grown in prominence in recent decades and been the focus of accusations of conflicted interests detrimental to audit quality. Evaluating legitimacy as a rhetorical and communicative process can aid regulators to render visible the means by which auditors use rhetoric to influence reform, and thereby improve democratic oversight over the profession.

Keywords: Auditing; Audit quality; Auditor legitimacy; Audit Regulation; Neutralization techniques; Legitimation (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S104523542300028X
Full text for ScienceDirect subscribers only

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:eee:crpeac:v:97:y:2023:i:c:s104523542300028x

DOI: 10.1016/j.cpa.2023.102580

Access Statistics for this article

CRITICAL PERSPECTIVES ON ACCOUNTING is currently edited by Marcia Annisette, Christine Cooper and Yves Gendron

More articles in CRITICAL PERSPECTIVES ON ACCOUNTING from Elsevier
Bibliographic data for series maintained by Catherine Liu ().