Accounting Organizations and Society最新文献

Within the accounting profession, a persistent organizational issue is higher turnover rates among Black employees compared to White employees. Yet, there is currently no clear theoretical understanding of the reasons behind this higher turnover and how to reduce it. Drawing from focus groups of Black certified public accountants and in-depth interviews with both Black accountants and White supervisors of Black accountants, we developed a theoretical framework highlighting crucial psychological, behavioral, and relational factors that we predict are associated with reduced turnover intentions by Black employees. We propose that Black employees' racial centrality is associated with racial identity affirmation—attempts to affirm one's racial identity by expressing and highlighting positive aspects of one's racial group. Furthermore, we posit that the relationship between racial identity affirmation and reduced turnover intentions is weaker for Black accountants who feel less close to their supervisors, as their affirmations are less likely to be validated. We tested these hypotheses using a sample of 222 Black accountants, and our findings supported our predictions. We discuss the implications of these findings for theory, practice, and future research.

Despite the growing importance of machine learning in today's organisations, we know relatively little about how machine learning operates and how it influences calculative practices and cultures. Based on 695 hours of ethnographic fieldwork in the team of credit modellers from a large internet company in China, this study analyses the calculative culture that underpins the development of credit models. We show that credit scoring methodologies develop progressively into a self-referential set of calculative practices where substantive concerns about loan default are supplanted by more insular concerns around the seamless operation of the model. Insofar as the latter can only be measured by the model itself, this reduces the role of calculative experts to facilitators of machine learning rather than the purposeful interpreters of machine learning produced data. In this regard, credit scoring experts focus more on ensuring that models have a robust conversation with themselves rather than with managers or credit scoring agents. This matters because machine learning-driven credit scoring models end up privileging access to credit for those whose data trails more readily pass through data preparation filters rather than those who are less likely to default. We thus contribute to an understanding of how machine learning-driven calculative cultures both enact algorithmic bias and operate beyond the ken of purposeful human actors.

This study examines how accounting professionals empower themselves to become influential in the transnational governance space of accounting regulation and how their ideas can persist after they leave their powerful positions. Combining the concept of issue professionals with elements from the transnational governance literature, our multi-episode study investigates the role of six issue professionals in the decades-long reform process towards anchoring the rights approach in the international lease accounting standard (IFRS 16) and the definition of assets in the IASB's conceptual framework. We highlight how these issue professionals developed an extended commitment to the rights approach, which motivated them to advance from national to more central positions in the transnational governance space. We show how their specialised knowledge on lease accounting and asset definition allowed them to navigate positions and seize control over the treatment of both accounting issues. We further demonstrate that the interplay between socialisation and formalisation of interaction patterns fostered the incremental anchoring of the rights approach at the IASB once the issue professionals who provided the impetus for change had left their influential positions. Our study contributes to the literature on transnational governance and the political economy of accounting standard-setting by elaborating on the incremental rise to power of individuals and groups, and their influence on transnational institution-building processes.

Professional audit firms increasingly engage in Corporate Social Responsibility (CSR) activities. This paper examines the effect of audit firms' CSR activities on auditors’ reputation. We find that audit firms that engage in CSR experience an increase in the size of their client base compared to audit firms that do not engage in CSR. The effect is stronger for audit firms without existing reputation from a Big 4 brand name or industry specialization. We also find that clients that value CSR are more likely to hire audit firms that engage in CSR. Overall, our results suggest that CSR is an effective tool for audit firms to build their reputation in the marketplace.

Research links intangible employee outcomes with ultimate firm performance and business press suggests peer recognition systems can positively influence such employee outcomes, including the degree to which employees feel appreciated. We collect survey data at a company both pre and post the rollout of their public peer recognition system. Contrary to company expectations, employees felt less appreciated by their peers after system implementation. We then develop and experimentally test theory to better explain why this decline likely occurred. We find that two features of public peer recognition systems, public feeds and leaderboards, induce different types of social comparisons, and each have incrementally negative effects on the average feelings of appreciation among employees, even though, in isolation, peer recognition positively influences employees’ feelings of appreciation. These results help explain the findings from our field surveys and highlight that firms should carefully consider how the features of their peer recognition systems affect employees, as some features may unintentionally harm employee outcomes.

The rapid rise of social media enables companies to disclose information to the public instantly. Thus, auditors may initially receive client information via a client's social media account instead of through private, client-to-auditor communication. Drawing on Social Penetration Theory, we conduct an experiment to investigate how a client's initial disclosure via social media (versus private disclosure) and audience engagement of the client's posts (e.g., number of “likes,” “replies,” and “reposts”) affects auditors' perception of the auditor-client relationship and their evaluation of the client-provided information. We find that when auditors initially receive client information via social media with high audience engagement, they are less willing to accept the client's preference than when the same information is disclosed privately or publicly with minimal audience engagement. Our findings are consistent with auditors perceiving client disclosure via social media with high audience engagement as a significant violation of their communication expectations such that their relational closeness with the client weakens and causes them to respond critically. We contribute to the literature on the use of social media for corporate disclosure, which has implications for the auditor-client relationship and audit quality.

Contentious interactions can arise between a tax professional and client upon disagreement over a tax position. These interpersonal exchanges can lead to “opinion shopping” and represent a threat to voluntary tax compliance and the public interest. Opinion shopping is likely to increase in an era of rising narcissism because antagonistic narcissists are known to react aggressively to rejection of their views. To better understand drivers of opinion shopping, we conduct a quasi-experiment with 222 U.S taxpayers. We find clients with higher (lower) levels of antagonistic narcissism are more (less) likely to opinion shop and switch to another tax preparer. We also examine the efficacy of two theory-motivated moderators of client antagonistic narcissism: [1] tax professional – client social bonds and [2] persuasive messaging by the advisor. By doing so, we respond to calls to explore moderating influences on the undesirable effects of antagonistic narcissism while also providing novel insight into factors influencing taxpayer clients’ decision-making following interpersonal exchanges with a tax advisor. We find that while close social bonds and sanction warnings reduce opinion shopping among participants lower in antagonistic narcissism, they fail to do so among participants higher in antagonistic narcissism. Theory provides no basis for predicting a three-way interaction, and we find none. Contributions to the research literature, as well as implications for tax practice and policy internationally, are also discussed.

In this study, we examine how personality attributes and a coordinated compensation design jointly contribute to complementarity in the CEO–CFO dyad. Drawing on regulatory focus theory, we propose that the combination of a CEO with a promotion focus and a CFO with a prevention focus benefits firms. In such a dyad, promotion-focused CEOs bring creativity, speed, and eagerness to advancement, whereas prevention-focused CFOs attend to vigilance, helping to keep promotion-focused CEOs grounded. We further argue that the effectiveness of this CEO–CFO dyad depends on promotion-focused CEOs being open to critical advice from prevention-focused CFOs. To make CEOs more amenable to CFOs' advice, we suggest similar compensation plans that foreground common objectives. We empirically test our arguments by focusing on the CEO–CFO dyad's influence on investment spending and firm performance in a longitudinal sample covering more than 10,000 firm years. Our results indicate a positive association between CEO promotion focus and investment spending, as well as firm performance. We further find that CFO prevention focus weakens the association between CEO promotion focus and investment spending, but strengthens the association with firm performance. These moderating influences of CFO prevention focus are more pronounced for higher compensation similarity in the CEO–CFO dyad. In sum, our findings exemplify that deliberately considering CEO and CFO personality attributes and their compensation design jointly strengthens the functioning of the CEO–CFO dyad.

We investigate the costs and benefits of the PCAOB's risk-based inspection regime by studying how auditors respond to engagement-level inspection risk. Using an established inspection selection model, we find evidence that auditors behave consistent with accountability theory when auditing clients with elevated ex-ante inspection risk. Specifically, we observe an increased propensity to report material weaknesses, a decreased propensity to assert that previous material weaknesses have been remediated, increased audit effort, and a decreased likelihood of subsequent financial statement restatement. In general, these outcomes reflect auditors' attempts to minimize negative inspection outcomes in a way that could be beneficial to investors. However, auditors' apparent focus on relative inspection risk also creates potential costs for investors as evidenced by an increased likelihood of resignation from the client and inattention to clients with relatively lower inspection risk when auditor resources are most constrained. Importantly, several tests provide evidence that auditors' response to inspection risk is distinct from and incremental to their response to misstatement risk. Overall, our findings suggest that there are potential benefits and potential costs associated with auditors' responses to a selection approach that is primarily risk-based.