How Do Team Workloads and Team Staffing Affect the Audit? Archival Evidence from U.S. Audits

61 Pages Posted: 12 Jul 2019 Last revised: 7 Jan 2021

See all articles by Brant E. Christensen

Brant E. Christensen

University of Oklahoma; Norwegian School of Economics (NHH) - Department of Accounting, Auditing and Law

Nathan J. Newton

Florida State University

Michael S. Wilkins

University of Kansas

Date Written: January 7, 2020

Abstract

We use U.S. data from a global accounting firm to investigate how two key elements of audit teams –workloads and staffing continuity – affect the audit. We find that heavier team workloads are associated with lower audit quality, particularly when team members have lower performance ratings or have total workloads that exceed 60 hours per week. In addition to finding evidence of employee burnout, we also document an incremental distraction effect. Specifically, we find that audit quality on the primary client suffers when team members spend more time during busy season on other concurrent clients. Regarding continuity, we find that greater year-over-year team staffing continuity is associated with improved audit quality, efficiency, and profitability. These effects are strongest when returning team members are highly rated or work in smaller audit offices. Finally, the effects of workload and continuity on audit quality at the team level are driven by audit seniors and audit staff, suggesting that offices should be particularly careful as they develop schedules for junior auditors. Overall, our study provides important new evidence about audit teams as called for by academics and regulators.

Keywords: audit teams, audit workload, turnover, audit quality, audit effort

Suggested Citation

Christensen, Brant E. and Newton, Nathan J. and Wilkins, Michael S., How Do Team Workloads and Team Staffing Affect the Audit? Archival Evidence from U.S. Audits (January 7, 2020). Accounting, Organizations and Society, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3418533 or http://dx.doi.org/10.2139/ssrn.3418533

Brant E. Christensen

University of Oklahoma ( email )

Norman, OK 73019-4004
United States

Norwegian School of Economics (NHH) - Department of Accounting, Auditing and Law ( email )

Helleveien 30
N-5045 Bergen
Norway

Nathan J. Newton

Florida State University ( email )

Rovetta Business Bldg. (RBA)
College of Business
Tallahassee, FL 32306-1110
United States

HOME PAGE: http://https://business.fsu.edu/person/nate-newton

Michael S. Wilkins (Contact Author)

University of Kansas ( email )

Capitol Federal Hall
1654 Naismith Dr.
Lawrence, KS 66045
United States

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