Auditing in the Era of Digital and Policy Uncertainties: The Effects of Auditor Knowledge and Client Bargaining Power on Audit Outcomes

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Journal Title

Journal ISSN

Volume Title

School of Business | Doctoral thesis (article-based)

Date

2021

Major/Subject

Mcode

Degree programme

Language

en

Pages

26 + app. 152

Series

Aalto University publication series DOCTORAL DISSERTATIONS, 116/2021

Abstract

The goal of this doctoral dissertation is to better understand the effects of the external factors shaping the profession of auditing, particularly changes in digitalization, regulations, and macroeconomic policies. Specifically, this work consists of an introduction and three self-contained essays that, using empirical data and methods, study how external factors affect auditing, particularly how digitalization and regulations penetrate through auditor competences, and the policy uncertainty through client bargaining power. The first essay examines the relationship between audit partner expertise in client digitalization and audit fees. This study examines if clients value audit partners' expertise in client digitalization and whether they are willing to pay higher audit fees for such expertise. The second essay explores the importance of auditors' knowledge and skills over any specializations. Specifically, the essay focuses on the generic level of knowledge and technical competence of an auditor and how higher levels of knowledge and competence are reflected in subsequent career success and the quality of audits. The third essay examines the relationship between uncertainty regarding economic policy and audit fees, focusing on the client's bargaining power. The study explores whether auditors compromise on audit prices with their clients with high bargaining power during periods of high policy uncertainty.

Description

Defence is held on 1.10.2021 13:00 – 16:00 Zoom https://aalto.zoom.us/j/69405764382

Supervising professor

Niemi, Lasse, Prof., Aalto University, Department of Acounting, Finland

Thesis advisor

Jarva, Henry, Prof. Hanken School of Economics, Finland
Sihvonen, Jukka, Prof., Aalto University, Finland

Keywords

audit, auditor knowledge, policy uncertainty, digitalization specialist

Other note

Parts

  • [Publication 1]: Maghakyan, Arpine; Jarva, Henry; Niemi, Lasse; Sihvonen, Jukka. The Effect of Audit Partner Digitalization Expertise on Audit Fees: Empirical Evidence from the US and Finland. Unpublished Manuscript
  • [Publication 2]: Fredriksson, Antti; Hay, David; Karjalainen, Jukka; Maghakyan, Arpine; Niemi, Lasse. Is Professional Exam Performance Associated With Career Success In Auditing? Unpublished Manuscript
  • [Publication 3]: Maghakyan Arpine. Economic Policy Uncertainty, Client Bargaining Power And Auditor Fees. Unpublished Manuscript

Citation