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Female audit partners and extended audit reporting: UK evidence

Female audit partners and extended audit reporting: UK evidence
Female audit partners and extended audit reporting: UK evidence
This study investigates whether audit partner gender is associated with the extent of auditor disclosure and the communication style regarding risks of material misstatements that are classified as key audit matters (KAMs). Using a sample of UK firms during the 2013–2017 period, our results suggest that female audit partners are more likely than male audit partners to disclose more KAMs with more details after controlling for both client and audit firm attributes. Furthermore, female audit partners are found to use a less optimistic tone and provide less readable audit reports, compared to their male counterparts, suggesting that behavioural variances between female and male audit partners may have significant implications on their writing style. Therefore, this study offers new insights on the role of audit partner gender in extended audit reporting. Our findings have important implications for audit firms, investors, policymakers and governments in relation to the development, implementation and enforcement of gender diversity.
Auditor gender, Key audit matters, Gender diferences, Extended audit reporting, Tone, Readability
0167-4544
177-197
Elmahgoub, Mohamed
bf66be6b-835d-42c0-97cd-ec717922c916
Abdelfattah, Tarek
c97bf00f-7dba-4077-b005-67049156284b
A. Elamer, Ahmed
61b18309-2562-453f-a305-52be29dec3fc
Elmahgoub, Mohamed
bf66be6b-835d-42c0-97cd-ec717922c916
Abdelfattah, Tarek
c97bf00f-7dba-4077-b005-67049156284b
A. Elamer, Ahmed
61b18309-2562-453f-a305-52be29dec3fc

Elmahgoub, Mohamed, Abdelfattah, Tarek and A. Elamer, Ahmed (2020) Female audit partners and extended audit reporting: UK evidence. Journal of Business Ethics, 174, 177-197. (doi:10.1007/s10551-020-04607-0).

Record type: Article

Abstract

This study investigates whether audit partner gender is associated with the extent of auditor disclosure and the communication style regarding risks of material misstatements that are classified as key audit matters (KAMs). Using a sample of UK firms during the 2013–2017 period, our results suggest that female audit partners are more likely than male audit partners to disclose more KAMs with more details after controlling for both client and audit firm attributes. Furthermore, female audit partners are found to use a less optimistic tone and provide less readable audit reports, compared to their male counterparts, suggesting that behavioural variances between female and male audit partners may have significant implications on their writing style. Therefore, this study offers new insights on the role of audit partner gender in extended audit reporting. Our findings have important implications for audit firms, investors, policymakers and governments in relation to the development, implementation and enforcement of gender diversity.

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Accepted/In Press date: 19 August 2020
Published date: 15 September 2020
Keywords: Auditor gender, Key audit matters, Gender diferences, Extended audit reporting, Tone, Readability

Identifiers

Local EPrints ID: 452307
URI: http://eprints.soton.ac.uk/id/eprint/452307
ISSN: 0167-4544
PURE UUID: 0e208ba2-ba28-4cd4-be4c-1666125eef5a

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Date deposited: 06 Dec 2021 17:35
Last modified: 05 Jun 2024 19:09

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Contributors

Author: Tarek Abdelfattah
Author: Ahmed A. Elamer

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