Auditor Workload and the Communicative Value of Key Audit Matters
Wei-heng Lin/Department of Accounting Information, National Taipei University of Business
Hon-Ren Lin/Department of Management Information, National Taipei University of Business
Yi-Xiang Lin/Deloitte & Touche, Taiwan
Abstract
Present study uses texts of key audit matters (KAM) in auditors’ reports from 2016 to 2020 to explore whether the auditor busyness undermines the communicative value of KAM. Using text mining analysis, we measure two KAM characteristics: readability and specificity. We find that the busier the auditors, the more readable the KAM, i.e., the shorter the content and the lower frequency in using jargon. We also find that busy auditors provide more specific information in KAM. Our empirical results suggest that auditor workload does not undermine the communicative value of KAM in current regulatory settings.
Keywords
Audit quality indicatorsExpanded audit reportFog indexSpecificity
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