Attorney Strategy and Experience in Disputes against Auditors: Insights from the Legal Field

• In Event: Auditor Litigation

Abstract

This paper examines the relative importance of case facts and plaintiff attorneys’ legal strategy in resolution of audit disputes. Based on the untested suggestion in legal research literature, we predict that legal strategy matters more than facts in making decisions that are closer to dispute resolution. We find support for our theoretical model by empirically examining the legal judgments of law faculty, attorneys with significant experience in audit litigation, and law students. Our results indicate that experience in audit litigation matters more in decisions that are more dependent on legal strategy and that these decisions tend to be closer to dispute resolution. We conclude that future research is needed to understand the antecedents and consequences of legal strategy in audit disputes, but that this research requires using experienced attorneys. However, future research is also needed to examine decisions that are less dependent on strategy, and in many cases, this research can be examined using law students, a previously unutilized (in audit litigation research) but readily accessible participant pool. We discuss implications of our findings for audit practice and suggest multiple avenues for future research.

Authors

• Brian Matthew Goodson, Clemson University

• Jonathan H Grenier, Miami University

• Eldar Maksymov, Arizona State University - Tempe