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Open Access
Article
Publication date: 5 January 2024

Jesper Haga and Kim Ittonen

This paper examines the organizational resilience of audit firms during the early stages of COVID-19. The unexpected restrictions placed on travel and on-site working created…

Abstract

Purpose

This paper examines the organizational resilience of audit firms during the early stages of COVID-19. The unexpected restrictions placed on travel and on-site working created unanticipated barriers for auditors in Hong Kong. The authors expect that auditors with greater organizational resilience can respond to unexpected situations and restore expected performance levels relatively quickly.

Design/methodology/approach

The authors utilize a sample of 1,008 companies listed on Hong Kong Stock Exchange (HKEX) with a financial year-end of December 31. The authors identify five proxies contributing to organizational resilience: auditor size, industry specialization, diversity, geographic proximity to the client and auditing a new client. The authors use audit report timeliness as this study's main dependent variable.

Findings

This study's full-sample results suggest that larger auditors, industry specialists and auditors with closer relationships to clients issued more timely audit reports during the pandemic. The analysis of a subsample of companies that initially published unaudited financial statements reveals that industry expertise and longer auditor-client relationships significantly reduced the need for year-end audit adjustments. Finally, the authors find that larger auditors were more likely to offload clients, whereas industry specialists were more likely to retain clients.

Research limitations/implications

The results of the paper suggests that audit firm characteristics associated cognitive abilities, behavioral characteristics and contextual conditions are associated with audit firm organizational resilience and, consequently, helps auditors respond unexpected changes in the audit environment.

Practical implications

The findings of the paper are informative for those involved in audit firm management or auditor hiring and retention decisions.

Originality/value

This study is the first to link organizational resilience to the performance of audit firms in a time of unexpected events. The authors connect three auditor and two auditor-client dimensions to the organizational resilience of the audit firms.

Details

Journal of Applied Accounting Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0967-5426

Keywords

Article
Publication date: 11 December 2023

Mahesh Subramony and Mark S. Rosenbaum

The purpose of this study is to address United Nations’ sustainable development goals (SDGs) 8 and 9 from a service perspective. SDG 8 is a call to improve the dignity of service…

Abstract

Purpose

The purpose of this study is to address United Nations’ sustainable development goals (SDGs) 8 and 9 from a service perspective. SDG 8 is a call to improve the dignity of service work by enhancing wages, working conditions and development opportunities while SDG 9 calls upon nations to construct resilient infrastructures, promote inclusivity and sustainability and foster innovation.

Design/methodology/approach

This study uses a bibliometric review to extract important themes from a variety of scholarly journals.

Findings

Researchers tend to investigate policy-level topics, such as national and international standards related to working conditions, while ignoring the experiences or well-being of workers occupying marginalized and low-opportunity roles in service organizations. Service researchers, educators and practitioners must collaborate to improve the state of service industries by conducting participatory action research, promoting grassroots organizing/advocacy, implementing digitized customer service and addressing workforce soft skills deficiencies.

Research limitations/implications

The authors consider how service work can be transformed into respectable employment and present four specific ways nations can enhance their service industries.

Practical implications

Economic planners can view SDGs 8 and 9 as a framework for understanding and promoting the well-being of service employees and accelerating the productivity and innovation levels of the service sector.

Originality/value

The United Nations’ SDGs are examined from a services perspective, which increases their significance in service-dominated economies.

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