Keywords

PCAOB inspections, audit regulation

Abstract

Changes in the audit profession after Sarbanes-Oxley, including mandatory audits of internal control over financial reporting and PCAOB oversight and inspection of audit work, have potentially changed the nature and extent of audit sampling in the largest accounting firms. In our study, ‘‘Behind the Numbers: Insights into Large Audit Firm Sampling Policies’’ (Christensen, Elder, and Glover 2015), we administered an extensive, open-ended survey to the national offices of the Big 4 and two other international accounting firms regarding their firm’s audit sampling policies. We find variation among the largest firms’ policies in their use of different sampling methods and in inputs used in the sampling applications that could result in different sample sizes. We also provide evidence of some of the sampling topics firms find most problematic, as well as changes to firms’ policies regarding revenue testing due to PCAOB inspections. Our evidence provides important insights into current sampling policies, which may be helpful to audit firms in evaluating their sampling inputs and overall sampling approaches.

Original Publication Citation

"Behind the Numbers: Insights into Large Audit Firm Sampling Policies", Edition 1, Volume 29, Pages 61-81, ACCOUNTING HORIZONS, 2015

Document Type

Peer-Reviewed Article

Publication Date

2015

Publisher

Accounting Horizons

Language

English

College

David O. McKay School of Education

Department

Accountancy

University Standing at Time of Publication

Associate Professor

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