The future of auditing research

Auditing is a professional, economic and regulated activity executed by individuals with the help of audit technology. All these aspects of auditing are interrelated and jointly affect what will be the eventual quality of an audit. An audit is conducted by professionals who have acquired the specific skills and knowledge necessary to perform the audit, and who possess the appropriate licence to hold themselves up as professional. In the course of an audit, specialized technology is used to augment the professional expertise of individuals. Further, audits are economic goods in the sense that a market exists to match those who will supply an audit with those who would demand an audit. In that market, auditors compete with each other to obtain new clients. However, audits and the audit market are also very heavily regulated. Who needs an audit, who can supply an audit, and the conditions under which the two parties can contract for audit services are all subject to various forms of regulation. There is also a risk of litigation against the auditor in case of malpractice. In the past decade we have seen a large increase, globally, in regulation of auditing and auditors. Nevertheless, because the audit is a human activity conducted by individual auditors, the quality of a specific audit is conditional on individual auditor characteristics and the incentives that auditors face. Given all these aspects, auditing is a complex phenomenon to study and understand. Over the past 30 years, audit research has grown exponentially and we have learned a tremendous amount about auditing, auditors and audit markets. This book was designed to present key research findings to a broad audience interested in the auditing profession. The various chapters report and summarize a number of significant audit research areas. In this closing chapter we will not repeat what we learn from the chapters. Instead we will reflect on what we believe are some key issues for future research.