Audit firms, audit partners and their impact on audit job: an exploration of the Italian context

The purpose of the dissertation below is to advance the research on auditing topics. This study arises from a deep study of audit job in the Italian context, with its peculiarities and its regulation, and the analysis of the main topics studied by the international literature. Moreover, I made a long hand collection of data on the main accounting and audit aspects of Italian listed firms, for the period 2010-2013. After the improvement of knowledge on the topics, my supervisor and I developed the research ideas and transformed them in two quantitative analyses, using data previously collected. The dissertation is structured as follows. After a qualitative explanation of the main features of audit in Italy and a literature review of the main important and noted international studies on them, we develop two quantitative analyses on the sample of Italian firms. In particular, the first study is an examination of the efficacy of Mandatory Audit firm Rotation in the Italian regime. We observe the effect of tenure length on fees paid to the incumbent auditor and a direct association between tenure and quality. The second quantitative study is focused on the partner’s role in an audit engagement. In particular, we examine the effect of partner behaviour on audit job, when partner seniority increases; specifically, we draw on some peculiar cultural characteristics that epitomize the Italian context, such as the power distance and the gerontocracy.