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Auditors’ scepticism in response to audit committee oversight behaviour

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  • Sanaz Aghazadeh
  • Yoon Ju Kang
  • Marietta Peytcheva

Abstract

We use two experiments and a survey to examine how audit committee (hereafter, AC) oversight behaviour, particularly AC sceptical attitude and proactive behaviour, affects auditor scepticism, and whether the influence is driven by the risk aspect of auditors’ assessment of AC oversight behaviour. We find that when ACs exercise insufficient scepticism, auditors (junior auditors, managers, and partners) perceive AC oversight as weak, and increase their scepticism. However, AC proactive behaviour does not significantly influence auditor scepticism. Our findings suggest auditors view weak AC oversight as a risk indicator and respond by exercising greater scepticism.

Suggested Citation

  • Sanaz Aghazadeh & Yoon Ju Kang & Marietta Peytcheva, 2023. "Auditors’ scepticism in response to audit committee oversight behaviour," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(2), pages 2013-2034, June.
    • Handle: RePEc:bla:acctfi:v:63:y:2023:i:2:p:2013-2034
    DOI: 10.1111/acfi.12944
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    References listed on IDEAS

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