Gender and Engagement Partner Quality
Document Type
Article
Keywords
engagement partner; financial reporting; adult engagement; Form AP; identity disclosures
Identifier Data
https://doi.org/10.1108/JAOC-01-2023-0014
Publisher
Emerald Publishing Limited
Publication Source
Journal of Accounting and Organization Change
Rights Management
Copyright © 2024, Emerald Publishing Limited
Abstract
Purpose
The purpose of this study is to examine whether the gender of an audit engagement partner (EP) is associated with the quality of the EP’s audit output.
Design/methodology/approach
This paper defines a low-quality EP as an EP who leads the audit of at least one client firm that subsequently restates its financial statements, while a high-quality EP is an EP that is not associated with any restatement. Using a sample of 6,082 observations from 2016 to 2020, the study estimates a logistic regression of EP quality on EP gender and control variables.
Findings
The results show that female EPs are more likely to be high-quality EPs. With an odds ratio of 1.25, the results imply that female EPs are 1.25 times more likely to be associated with higher-quality audits compared to male EPs.
Research limitations/implications
The results of this study imply that female EPs are more likely to perform high-quality audits, and it supports the assertion that EP gender plays a significant role in determining EP quality. Further studies may apply gender theory to investigate the behavior of female EPs.
Practical implications
The results show that female EPs are more likely to be high-quality EPs. With an odds ratio of 1.25, the results imply that female EPs are 1.25 times more likely to be associated with higher-quality audits compared to male EPs.
Originality/value
The results of this study should be of interest to stakeholders such as audit committees, regulators, investors and creditors, as they provide an indicator for assessing the quality of audits. Moreover, considering the EP’s important role in an audit, the current study extends the existing literature by providing evidence of a relationship between EP gender and EP quality.
