Qualitative accounting research: dispelling myths and developing a new research agenda

Villiers, Charl de; Dumay, John; Maroun, Warren

doi:10.1111/acfi.12487

Cited by 69 publications

(90 citation statements)

References 109 publications

(111 reference statements)

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“…A common argument against qualitative findings is that, since statistical inference is lacking and data are often collected from direct engagement with a limited number of participants, the results are biased or anecdotal. Safeguards have been put in place to address these limitations (de Villiers et al, 2019). Firstly, as discussed in Section 2, findings are generated using audit quality frameworks drawing on the relevant professional and academic literature.…”

Section: Discussionmentioning

confidence: 99%

“…A qualitative research design does not result in reproducible data which can be subject to robustness checks and probability testing. Nevertheless, detailed interviews are more appropriate for exploring complex and seldom studied aspects of audit practice where quantitative techniques run the risk of being reductionist and overlooking important interconnections (Baxter et al, 2008;de Villiers et al, 2019;O'Dwyer et al, 2011). This is especially true when it comes to MAFR which, to date, has only been examined by a limited number of papers relying on inferential testing of broad quality surrogates (see Casterella and Johnston, 2013;Hay, 2015).…”

Section: Methodsmentioning

confidence: 99%

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Audit quality implications of regulatory change in South Africa

Ndaba

Harber

Maroun

2021

JAEE

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PurposeThis paper explores how technical constructions of audit practice are influenced by mandatory audit firm rotation (MAFR) regulations. The paper responds to calls for additional research on how external regulation influences audit quality and supplements the predominately quantitative research dealing specifically with firm rotation and its relevance for audit quality.Design/methodology/approachData are collected from South Africa which is the latest jurisdiction to adopt MAFR (from 2017). Detailed interviews with 49 participants comprising 24 audit partners and 25 non-auditors are conducted to explore how MAFR can impact audit quality. For this purpose, audit quality is defined according to a schematic developed interpretively and based on professional auditing standards and the prior research on audit quality.FindingsThere is no guarantee that MAFR will bolster auditors' independence or contribute to a more thorough audit approach. On the contrary, the effort required by incoming audit firms to gain an understanding of new clients coupled with material tendering costs is expected to decrease the profitability of audit engagements with adverse implications for audit quality. A loss of client experience and staff retention challenges may contribute further to a decline in audit quality. There may be some improvements to audit practice when an incumbent firm's work is going to be scrutinised by a new auditor but audit methodologies, including the nature and extent of testing performed, are not expected to change significantly because of MAFR. In this way, the regulation may be a symbolic response to a perceived decline in audit quality and auditor independence rather than part of an effective strategy to encourage more rigorous audit practice for the benefit of the users of financial statements.Originality/valueThe current paper provides one of the first exploratory accountants of how MAFR is expected to impact audit practice and, in turn, audit quality. The research responds to the call for more field-work studies on the mechanics of the audit process by engaging directly with practitioners instead of relying on inferential testing of broad audit quality surrogates. The study also makes an important empirical contribution by providing primary evidence on how external regulation influences audit practice from a seldom studied African perspective.

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Section: Discussionmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Audit quality implications of regulatory change in South Africa

Ndaba

Harber

Maroun

2021

JAEE

Self Cite

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“…In addition, the aim is to obtain a detailed perspective on the implications of MAFR rather than testing for possible effects in a positivist sense. This makes an exploratory research design, which highlights principles, themes and conflicting views, the most suitable for studying MAFR in a setting where there is no prior research dealing directly with the topic (de Villiers et al, 2019;Hay, 2015). Data were collected in two stages.…”

Section: Methodsmentioning

confidence: 99%

Mandatory audit firm rotation: a critical composition of practitioner views from an emerging economy

Harber

Maroun

2020

MAJ

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Purpose This study aims to address an acknowledged gap in the literature for the analysis of experienced practitioner views on the effects and implications of mandatory audit firm rotation (MAFR). Design/methodology/approach Using an exploratory and sequential design, data was collected from South African regulatory policy documents, organisational comment letters and semi-structured interviews of practitioners. These findings informed a field survey, administered to auditors, investors, chief financial officers (CFOs) and audit committee members of Johannesburg Stock Exchange (JSE) listed companies. Findings Practitioners expressed considerable pushback against the potential efficacy of MAFR to improve audit quality due to various “switching costs”, notably the loss of client-specific knowledge and expertise upon rotation. In addition, the cost and disruption to both the client and audit firm are considered significant and unnecessary, compared to audit partner rotation. The audit industry may suffer reduced profitability and increased strain on partners, leading to a decline in the appeal of the profession as a career of choice. This is likely to have negative implications for audit industry diversity objectives. Furthermore, the industry may become more supplier-concentrated amongst the Big 4 firms. Practical implications The findings have policy implications for regulators deciding whether to adopt the regulation, as well as guiding the design of policies and procedures to mitigate the negative effects of adoption. Originality/value The participants are experienced with diverse roles concerning the use, preparation and audit of financial statements of large exchange-listed multinational companies, as well as engagement in the auditor appointment process. The extant literature presents mixed results on the link between MAFR and audit quality, with most studies relying on archival and experimental designs. These have a limited ability to identify and critique the potential’s witching costs and unintended consequences of the regulation. Experienced participants responsible for decision-making within the audit, audit oversight and auditor appointment process, are best suited to provide perspective on these effects, contrasted against the audit regulator’s position.

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“…The study relies on a systematic literature review to examine the definitions and main topics underpinning the term NFI. To increase the validity of the study, the triangulation of information sources and collection methods was undertaken (Patton, 2002; Gioia et al , 2012; De Villiers et al , 2019). Therefore, to improve the consistency of our results and to further explore scholars’ understanding of NFI term, we used a questionnaire survey.…”

Section: Introductionmentioning

confidence: 99%

Exploring the term “non-financial information”: an academics’ view

Tarquinio

Posadas

2020

MEDAR

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Purpose With the European Union (EU) Directive 2014/95/UE, there is a growing interest in the corporate disclosure of “non-financial information” (NFI). However, no generally accepted definition of this term exists. This paper aims to reflect on the meaning and importance of the NFI definition by investigating how this term is defined in the literature and by exploring scholars’ cognitive perceptions of its meaning. Design/methodology/approach Two different research methods were used. A systematic literature review of NFI definitions was integrated with a survey to a sample of Italian scholars working on the NFI research topic. Findings This study demonstrates that the meaning of NFI is still ambiguous and multifaceted as neither a common understanding nor a single and generally accepted definition of the term exists. As the advent of the EU directive, this term has often referred to information about society and the environment, though most academics define and understand NFI differently, as corporate social responsibility (CSR) issues, intellectual capital information and information that are external to financial statements. These definitions pave the way for conceptualising NFI as a genus and its different understandings (i.e. CSR, ESG information, etc.) as species. Therefore, what constitutes NFI is open to interpretations. Research limitations/implications This paper contributes to enriching the literature on the meaning of NFI and providing further insights into explaining the heterogeneity of the NFI definition. Practical implications This paper provides researchers, practitioners and regulators with some novel insights into the meaning and understanding of NFI. It provides regulators and standard setters with knowledge for building a commonly accepted definition of NFI. Meanwhile, policymakers, regulators, practitioners and academics can contribute to establishing a definition by following three approaches: regulative, open and adaptive. This can help to avoid the risk of an information gap among stakeholder expectations, regulator requests and NFI reporting in practice. Originality/value The literature focussing on the meaning of NFI is still scarce. This study contributes to extending the knowledge of how the term NFI is defined and understood by academics.

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Qualitative accounting research: dispelling myths and developing a new research agenda

Cited by 69 publications

References 109 publications

Audit quality implications of regulatory change in South Africa

Audit quality implications of regulatory change in South Africa

Mandatory audit firm rotation: a critical composition of practitioner views from an emerging economy

Exploring the term “non-financial information”: an academics’ view

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