Dual Roles and Blurred Identities: A Framing Contest between Professional Associations in a Local Strategic Action Field

Abstract

This paper examines professional associations' local responses to global demands of accounting standardisation. Our longitudinal study from 1998 to 2018 analyses how professional associations of the German audit profession engaged in an intense framing contest over the adoption of external quality controls. Drawing on the concept of strategic action field and the literature on framing, we unpack how the gap between large audit firms and small audit firms increasingly undermined the capacity of the professional associations to fulfil their dual role of governance and representation. We unveil how their failed attempt to maintain the image of an unified profession ultimately led to the creation of a new professional association representing the 'small auditor' professional, which successfully, albeit temporarily, took control over the field of German auditing. Our findings suggest that the passivity of small audit firms in the process of translating global regulatory regimes should not be presumed. Rather, we provide insight into how small audit firms can rebuild their own identity by actively responding to waves of global regulation. Doing so, and contrary to prior research, our case highlights that governance units within strategic action fields are not necessarily aligned with the interests of the most powerful field actors.

Local authority audit in England, playing the field?

“…First, the theory recognizes that actors within a field may occupy different positions and that such positions may change as a result of their interactions and disputes (Loscher et al., 2021; Puyou, 2014). The theory recognizes three ideal‐types of actors.…”

“…For this reason, while we focus on the local authority financial audit SAF, we consider its relations with proximate fields, and crucially that of VFM inspection. At the same time, the local authority financial audit SAF is connected to the field of corporate audit through common auditing standards (Loscher et al., 2021) and actors.…”

Empirical Evidence on the Development and Digitalization of the Accounting and Finance Profession in Europe

“…Professional accounting associations have a dualistic role in relation to their members. The first is the governance role; the second is representing the interests of the members [30]. In relation to the governance role, professional bodies regulate the activities of accountants and other financial professionals, with a focus on training, ethics, admission, and licensing [17].…”

New Directions in Auditing Research: Conceptual Repair, Technological Disruption(s), Local Professional Governance and the Battle for Inclusivity

“…Transforming Field-level Governance of Audit -Change Dynamics in Professional Associations Loscher et al (2021) offer an in-depth examination of the tensions that global audit quality monitoring schemes provoke among different segments of the accounting profession. They highlight how globalized efforts to enhance audit quality which suited Big 4 accounting firms clashed with localized understandings of audit quality among smaller audit firms in Germany.…”