Audit Quality Perceptions

Abstract

Audit quality remains difficult for investors, audit committees, and other external stakeholders to define and evaluate because standardized, publicly available measures are limited. This article examines perceptions of audit quality through semi-structured interviews with three experienced participants in the financial reporting ecosystem: an audit committee member, a multinational corporation financial statement preparer, and a wealth management partner representing an investor perspective. The interviews indicate that audit quality is influenced not only by firm resources and regulatory oversight, but also by engagement-team continuity, partner expertise and judgment, audit committee diligence, and the ability to focus on areas of meaningful risk. Participants also identified concerns regarding personnel turnover, increasingly prescriptive audit procedures, the expectation gap, and the growing use of artificial intelligence in auditing. The article recommends expanding opportunities for junior auditors to address complex technical matters and reconsidering the nature of audit-quality disclosures. In particular, disclosures concerning how artificial intelligence is used, the audit tasks it performs, its effect on testing scope, and resulting efficiencies may provide stakeholders with more useful information for evaluating audit quality