Audit as Coproduction of Auditors and Clients: Implications for Professional Skepticism
Dela Cruz, Aeson Luiz, Dyball, Maria Cadiz, Patel, Chris
The Accounting Review · 2025 · Volume 100 · Issue 5
Abstract
We examine how coproduction develops between auditors and clients and its potential impact on the professional skepticism (PS) of auditors. We mobilizeKnechel, Thomas, and Driskill’s (2020)theoretical framework and Social Exchange Theory to analyze interviews with 24 audit partners and 26 chief financial officers and controllers. We find that auditors and clients share a view that they cocreate audits as they each contribute and combine competencies. Coproduction redresses information asymmetries, which enables PS. Although auditor-client relationships (ACRs) facilitate coproduction through reciprocity and trust, coproduction fosters conditions where auditors must balance exercising skeptical judgments and actions and abdicating professional responsibilities that result in impaired PS. The findings are useful for audit practitioners, standard-setters, and regulators as they will help strengthen policies, standards, and regulations on managing ACRs to enhance PS. The study offers theoretical and methodological directions for future research. Data Availability:Data are protected by confidentiality agreements with the interviewees. JEL Classifications:M42.
Keywords
professional skepticism, audit, coproduction, auditor-client relationships
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