Auditor workload compression and busy season portfolio changes: US evidence

Dennis M. López and Marshall K. Pitman

International Journal of Accounting, Auditing and Performance Evaluation, 2014, vol. 10, issue 1, 91-108

Abstract: The purpose of this study is to investigate the impact of auditor workload compression on the likelihood of changes to the busy season client portfolio of an audit firm. We find evidence of a positive association between workload compression and the likelihood of changes to the constituents of the busy season client portfolio of a local office. We also find evidence of a positive association between auditor-client misalignment and the likelihood of such changes. The results for our auditor risk proxies are consistent with prior studies, in support that auditors with greater levels of risk in their portfolios are more likely to engage in busy season client turnover. By using alternative research methods and considering previously overlooked variables, this study sheds new light on the factors influencing the portfolio management decisions of auditors.

Keywords: audit fees; auditor change; auditor risk; auditor switch; Big-N firms; busy season; client portfolio management; December year-end; earnings management; workload compression; USA; United States; auditing; auditor-client misalignment. (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijaape:v:10:y:2014:i:1:p:91-108

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