What question did this study set out to answer?

The goal is to identify characteristics of clients and auditors that are linked to lawsuits, reflecting the growing litigation environment in the accounting industry.

March 18, 2026The Accounting Review

Using Financial and Market Information to Identify Pre-Engagement Factors Associated with Lawsuits Against Auditors.

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Authors

JSJames D. SticeBrigham Young University

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Implication

This article examines characteristics linked to lawsuits against auditors, suggesting factors that influence litigation risk.

Key Points

The goal is to identify characteristics of clients and auditors that are linked to lawsuits, reflecting the growing litigation environment in the accounting industry.
Analysis of client and auditor characteristics
Review of malpractice insurance trends
Assessment of lawsuit impacts on auditing firms
Increased lawsuits against auditors negatively signal quality, harming auditor reputation.
Rising malpractice insurance rates correlate with increased litigation against audit firms.
Legal action is often seen as a cost-effective option for dissatisfied clients.

Cite This Study

James D. Stice (1991) studied this question.

synapsesocial.com/papers/69ba420a4e9516ffd37a1f30 https://doi.org/10.2308/tar-9605072955

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Using Financial and Market Information to Identify Pre-Engagement Factors Associated with Lawsuits Against Auditors.

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Key Points

Cite This Study

Using Financial and Market Information to Identify Pre-Engagement Factors Associated with Lawsuits Against Auditors.

Discussion

Member takes

Implication

Key Points

Cite This Study

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