21st Symposium on Audit Research

Sponsored by the KPMG Foundation

Held at the University of Illinois
September 11 – 13, 2014

This volume contains e-proceedings from the 21th Symposium on Auditing Research held at the I-Hotel and Conference Center in Champaign, Illinois on September 11-12 and the 1st Illinois Audit Doctoral Consortium held on September 13. Approximately 100 persons, including accountancy professors and practitioners as well as Illinois faculty and doctoral students attended the symposium, with many doctoral students and some faculty staying for the Doctoral Consortium. The KPMG Foundation’s ongoing generous support of the symposium series and doctoral consortium enabled us to bring participants together.

Consistent with tradition, many scholars volunteered their time and knowledge to produce a high-quality symposium. Reviewers provided constructive comments, authors and discussants made helpful and thoughtful presentations of their ideas, and participants posed insightful and stimulating questions.  The Symposium featured six research papers that collectively relied on a diverse set of theoretical perspectives and research methods to improve our understanding of pressing audit research issues. Topics included whether and conditions under which changing the content of audit reports could heighten auditor liability in cases of undetected fraudulent reporting, market consequences of individual audit partners, audit partner negotiations with client management, the determinants of audit quality, and the SEC enforcement record against auditors.  Douglas Laney, of the Gartner Group, delivered a stimulating keynote address to conclude the Symposium over dinner entitled “Can the Audit Profession Lever Big Data?”

The doctoral consortium featured presentations from esteemed audit scholars Mark Nelson (Cornell University) and William Kinney (University of Texas – Austin), which motivated and informed a set of 40 very promising, budding audit scholars from 16 institutions.  Three doctoral students presented ongoing research papers at the consortium as well.  Altogether the 21st Symposium and 1st Consortium on Auditing Research was a most educational and intriguing event.

Mark E. Peecher
University of Illinois

Anne Thompson
University of Illinois

List of Participants

Session I:  The SEC’s Enforcement Record Against Auditors

Simi Kedia, Rutgers Business School
Urooj Khan, Columbia Business School
Shiva Rajgopal, Goizueta Business School, Emory University

Discussant – Zoe-Vonna Palmrose, University of Washington

Session II: Risk Disclosure Preceding Negative Outcomes: The Effects of Reporting Critical Audit Matters on Judgments of Auditor Liability ◊ slides

Kelsey Brasel, Ball State University
Marcus Doxey, University of Alabama
Jon Grenier, Miami University
Andrew Reffett, Miami University

Discussant – Ken Trotman, University of New South Wales

Session III: Capital Market Consequences of Individual Audit Partners

Daniel Aobdia, Northwestern University
Chan-Jane Lin, National Taiwan University
Reining Petacchi, MIT Sloan School of Management

Discussant – Miguel Minutti-Meza, University of Miami

Session IV: Pressures on Audit Partner’s Negotiation Strategy and Decision Making 

Christopher Koch, Johannes Gutenberg University Mainz
Steve Salterio, School of Business, Queen’s University

Discussant – Brian White, University of Texas – Austin slides ◊

Session V: Does Big 4 Consulting Revenue Impair Audit Quality?

Ling Lei Lisic, George Mason University
Linda Myers, University of Arkansas
Robert Pawlewicz, George Mason University
Timothy Seidel, Utah State University

Discussant – Michael Minnis, University of Chicago

Session VI: Auditor-Relevant Congressional Committees and Audit Quality

Mihir Mehta, Temple University and MIT Sloan School of Management
Wanli Zhao, Southern Illinois University

Discussant – Thomas Omer, University of Nebraska

Dinner Speaker: Can the Audit Profession Lever Big Data?

Douglas Laney, Gartner Group

Doctoral Consortium

Invited Talk I: What Makes for A Good Research Project

William Kinney, University of Texas – Austin

Session I: Non-Audit Services and Improvements in Clients’ Operating Performance and Risk Management * Abstract *

William Ciconte, University of Florida
W. Robert Knechel, University of Florida
Michael Mayberry, University of Florida

Session II: Audit Firms as Networks of Offices

Tiffany Westfall, University of Nebraska
Scott Seavey, University of Nebraska
Michael Imhof, Wichita State University

Session III: The Impact of Proposed Changes to the Content of the Audit Report on Jurors’ Assessments of Auditor Negligence

Brian Goodson, University of Mississippi
Ann Backof, University of Virginia
Kendall Bowlin, University of Mississippi

Invited Talk II: Planning Your Early Academic Career

Mark Nelson, Cornell University

Planning Committee

Timothy Bauer
Jessen Hobson
Tracie Majors
Mark E. Peecher, Co-Chair
Heather Pesch
Theodore Sougiannis
Anne Thompson, Co-Chair