Auditors' Expertise and Social Capital

• In Event: Continental Breakfast and Research & Education Forum
  In Roundtable Session: Table 2: Social and Macroeconomic Issues in Auditing

Abstract

Auditors do not work in isolation because they belong to a social structure where they interact with different players. These interactions generate social capital, which helps auditors to reach favorable outcomes. In this paper we investigate the specific attributes that determine the cross-sectional variation in the levels of auditors’ social capital. We exploit the Italian regulation for statutory audit as a natural laboratory and we pull together literature on social capital and literature on auditors’ attributes. Our empirical results show that two dimensions of auditors’ expertise affect social capital: industry specialization and general experience. This paper contributes to the auditing field by explaining the characteristics of those auditors who have better access to the social structure relative to others. Moreover this paper has implications for practitioners because it provides relevant information about an understudied segment of the audit profession, the non-Big 4 auditors.

Authors

• Pietro Andrea Bianchi, IE University

• Marco Trombetta, Instituto De Empresa