What question did this study set out to answer?

The study aims to determine if audit quality differs between Big 4 and Second-Tier auditors during small and mid-sized IPOs, as indicated by SEC comment letters.

April 4, 2026Managerial Auditing Journal

Does audit quality differ between Big 4 and Second-Tier auditors in small and mid-sized IPOs? Evidence from SEC comment letters

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Authors

SSStefan SlavovUniversity of San Diego YLYan LuoUniversity of San Diego

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Implication

Examines audit quality in IPOs, revealing differences between Big 4 and Second-Tier auditors, indicating implications for compliance.

Key Points

The study aims to determine if audit quality differs between Big 4 and Second-Tier auditors during small and mid-sized IPOs, as indicated by SEC comment letters.
Analyzed SEC comment letters related to IPO registration statements.
Measured the number and types of accounting comments received by Big 4 and Second-Tier auditor clients.
Evaluated the response time and effectiveness of comment remediation by the firms.
Big 4 clients receive significantly fewer initial accounting comments than Second-Tier clients.
Big 4 firms address comments in fewer days and rounds compared to Second-Tier auditors.
Big 4 auditors are more likely to resolve comments in a single round.

Cite This Study

Slavov et al. (2026) studied this question.

synapsesocial.com/papers/69d0af83659487ece0fa56f2 https://doi.org/10.1108/maj-06-2025-4856

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Does audit quality differ between Big 4 and Second-Tier auditors in small and mid-sized IPOs? Evidence from SEC comment letters

Discussion

Member takes

Implication

Key Points

Cite This Study

Does audit quality differ between Big 4 and Second-Tier auditors in small and mid-sized IPOs? Evidence from SEC comment letters

Discussion

Member takes

Implication

Key Points

Cite This Study

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