Audit-firm serving experience heterogeneity and audit knowledge integration:Evidence from the disclosure of key audit matters

Audit practice is a team effort led by signing auditors.We examine the impact of the heterogeneity of signing auditors’audit-firm serving experiences on the disclosure of key audit matters(KAMs).Auditors with more heterogeneous serving experiences demonstrate more adequate KAM disclosure,as evidenced by more KAMs,longer texts and clearer attributions in their disclosures.This effect is influenced by the quality of audit knowledge that auditors accumulate from different serving experiences and the team-and audit-firm-level knowledge integration environment.Furthermore,signing auditors with more diverse service experience tend to improve audit quality,reduce the incidence of restatement or misconduct and enhance the informativeness of financial reports.Our findings enrich the KAM disclosure research and provide insights into audit firms’human resource allocation and internal management.

How do board features and auditor characteristics shape key audit matters disclosures?Evidence from emerging economies

This study examines how corporate board features and auditor characteristics in Bangladesh influence the disclosure of key audit matters(KAM)in annual reports from 2018 to 2021.Using ordinary least squares(OLS)regressions,the study finds that factors such as chair gender,the presence of women on the board,audit committee(AC)size,auditor tenure,and client-auditor relationship significantly affect KAM disclosure.However,AC expertise,family CEO succession,and board political connections do not have significant effects.Notably,having a family member CEO with a long-tenured auditor has a negative association with KAM disclosure,while a politically connected family CEO has a positive association with such disclosures.Additionally,Big-4 auditors of important clients are negatively associated with KAM disclosure.