Audit Partners’ Academic Credentials: A Signal of Audit Quality?

• In Event: Auditing and Auditor Characteristics

Abstract

This paper examines the association between academic audit partners (i.e., auditors who hold a doctorate or honorary professorship at a university or college), and audit fees and audit quality. We find that clients are willing to pay a fee premium for the audit services of academic partners and that the presence of academic audit partners during an audit engagement is positively associated with audit quality. However, we show that the academic auditor effect is prevalent in non-Big 4 firms but not in Big 4 audit firms. This may indicate that Big 4-auditors benefit from more rigorous quality control structures that weaken the effects of individual auditor characteristics.

Authors

• Janine Maniora, Heinrich-Heine-Universität Düsseldorf

• Ludwig Hilmer, Technical University of Munich

• Greg Trompeter, University of Central Florida