Business, Management and Accounting
3 years ago

Audit Brain Drain: Departing Auditors Impact Firm Revenue and Client Quality.

1 view
Contemporary Accounting Research
Is There a Brain Drain in Auditing? The Determinants and Consequences of Auditors Leaving Public Accounting*
W. Robert Knechel, Juan Mao, Baolei Qi, Zili Zhuang

Paper Summary

The article explores why auditors leave public accounting and the impact of their departures. It found that auditors who bring in more money and provide better quality audits are less likely to leave, while non–Big 4 auditors are more likely to leave. When auditors leave, their firms may lose clients, but those who stay pay lower fees without a drop in audit quality. High-quality auditors are less likely to leave but may lead to turnover within the firm. Clients may experience reduced audit quality when skilled auditors leave for corporate roles.

Related papers

Business, Management and Accounting
8 years ago

Audit Committees Crucial for Restoring Trust in Corporate Audits

Earnings Management
Risk Management
3 views
Business, Management and Accounting
8 years ago

Audit Committees Crucial for Reliable Financial Reporting, Preventing Auditor Manipulation

Earnings Management
3 views
Business, Management and Accounting
8 years ago

Audit Committees Prioritize Auditor Independence Over Competence in Hiring Decisions

Earnings Management
Management Control
2 views