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The portfolio of knowledge required by industry specialist auditors

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  • Roger Simnett
  • Arnold Wright

Abstract

While a number of studies have shown the superior performance of industry specialist auditors, prior research has not examined the underlying knowledge categories reflective of a specialist. This study aims to identify the range of knowledge required to be a successful industry specialist auditor, and the ways in which this knowledge is and might best be acquired. A multi-method approach was employed, including the use of a free-list task to identify important categories of knowledge, and a structured questionnaire. The questionnaire examined several issues including current knowledge of specific items, extent to which specialist knowledge is reflected in the firm's support systems, and methods by which this knowledge was, and could be, acquired. Participants, designated insurance industry specialists from a Big 4 firm, identified a large range of knowledge items, and there was a large degree of consensus between the results arising from the two knowledge identification research methods utilised. The results also revealed a number of perceived deficiencies in the level of current knowledge and the extent to which specialised knowledge is reflected in support systems. Few differences were found in the knowledge requirements of the two industry sub-specialisations, life insurance, and property and casualty insurance. Except for industry and economic factors, on-the-job experience was found to be the most prevalent method of gaining industry specialist knowledge. However, there was support for greater formal training and improved firm support systems for several specific knowledge items.

Suggested Citation

  • Roger Simnett & Arnold Wright, 2005. "The portfolio of knowledge required by industry specialist auditors," Accounting and Business Research, Taylor & Francis Journals, vol. 35(1), pages 87-101.
    • Handle: RePEc:taf:acctbr:v:35:y:2005:i:1:p:87-101
    DOI: 10.1080/00014788.2005.9729664
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    References listed on IDEAS

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    1. Cohendet, Patrick, et al, 1999. "Knowledge Coordination, Competence Creation and Integrated Networks in Globalised Firms," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 23(2), pages 225-241, March.
    2. Mark H. Taylor, 2000. "The Effects of Industry Specialization on Auditors' Inherent Risk Assessments and Confidence Judgements," Contemporary Accounting Research, John Wiley & Sons, vol. 17(4), pages 693-712, December.
    3. Solomon, I & Shields, MD & Whittington, OR, 1999. "What do industry-specialist auditors know?," Journal of Accounting Research, Wiley Blackwell, vol. 37(1), pages 191-208.
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    5. Craswell, Allen T. & Francis, Jere R. & Taylor, Stephen L., 1995. "Auditor brand name reputations and industry specializations," Journal of Accounting and Economics, Elsevier, vol. 20(3), pages 297-322, December.
    6. Weber, R, 1980. "Some Characteristics Of The Free-Recall Of Computer Controls By Edp Auditors," Journal of Accounting Research, Wiley Blackwell, vol. 18(1), pages 214-241.
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    Cited by:

    1. Weetman, Pauline, 2006. "Discovering the ‘international’ in accounting and finance," The British Accounting Review, Elsevier, vol. 38(4), pages 351-370.

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