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COVID-19 pandemic and audit quality

Author

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  • Lin, Bingxuan
  • Wu, Liansheng
  • Zhang, Yimin
  • Zhou, Jian

Abstract

In this study, we examine the influence of the COVID-19 pandemic on audit quality among firms listed in China, focusing on the role of empathy between auditors and their clients. Our analysis reveals that the pandemic's adverse effects on audit quality are predominantly observed when there is a high degree of empathy, particularly when both the audit firm and the client are located within areas heavily affected by the outbreak. Further investigation indicates that the deterioration in audit quality is primarily associated with auditors who have less experience, occupy junior positions, are employed by more philanthropically inclined audit firms, or work for firms outside the Big 10. Our research offers compelling evidence of the impact of empathy on audit quality and carries profound implications for various audit stakeholders, including management, auditors, shareholders, and regulatory bodies.

Suggested Citation

  • Lin, Bingxuan & Wu, Liansheng & Zhang, Yimin & Zhou, Jian, 2025. "COVID-19 pandemic and audit quality," The British Accounting Review, Elsevier, vol. 57(3).
    • Handle: RePEc:eee:bracre:v:57:y:2025:i:3:s0890838924002841
    DOI: 10.1016/j.bar.2024.101504
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