Prof. Chen CHEN
Professor in the Department of Accounting
Monash University
Date: Wednesday, 22 May 2024
Time: 10:00 – 11:30
Venue: E22-G015
Language: English
Host: Prof. Duncan Jiancheng LIU, Assistant Professor in Accounting
Abstract
In this paper, we provide direct evidence of how the non-audit service benefits the audit service by exploring the consulting partners’ assistance in the engagement audit partners’ work. Specifically, we show that the consulting partners with relevant skills are positively associated with the audit partners’ likelihood of identifying key audit matters (KAMs) outside the audit partners’ area of expertise (outside KAMs). Further analysis reveals that investors react to these outside KAMs identified through consulting partners’ expertise. We also find the audit committees of client firms are more likely to report these KAMs in their own reports. In addition, the knowledge transfer in the KAM identification is stronger when client firms have more complicated transactions and when the consulting audit partners have longer tenure.
Speaker
Chen Chen is a professor in the Department of Accounting, Monash University, Australia. His research interests are in the areas of financial reporting, auditing and corporate finance. His research has been published in numerous academic journals including Journal of Accounting Research, Management Science, Review of Accounting Studies, The Accounting Review, Auditing: A Journal of Practice & Theory, Journal of Accounting, Auditing and Finance, Journal of Accounting and Public Policy, Journal of Business Ethics, Journal of Banking and Finance, Journal of Business, Finance & Accounting, Journal of Corporate Finance and Accounting and Finance. Professor Chen’s research has also been profiled in publications such as ABC Money, Forbes, Harvard Business Review, London School of Economics Business Review, Columbia Law School’s Blog on Corporations and the Capital Markets, Strategy+, among many others.
All are welcome!
