Does Practitioner Research Help Auditors to Provide Higher Audit Quality and Improve their Reputation?

This paper investigates why auditors engage in practitioner research and whether these auditors subsequently provide higher audit quality and increase their reputation. Based on the theory of domain learning as well as insights from interviews, we argue that engaging in practitioner research could help auditors to acquire expertise relevant for performing the audit. Further, we draw on signaling theory and argue that this engagement might also contribute to the development of auditors’ reputation. We use the German setting for our study, where many auditors write professional articles, books, and book chapters. We observe that various motivational and support factors are important determinants for writing publications. We find that having prior publications is associated with higher audit quality, i.e. lower absolute discretionary accruals and a lower likelihood of restatements. Finally, we provide indications that having prior publications helps auditors to develop their reputation, i.e. achieving growth in their client portfolio.