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COVID-19 disrupted the audit of financial statements worldwide and affected group dynamics in an industry vital to the health of the economy, according to a new study.

Prior to the pandemic, core audit teams traditionally worked together in the client’s workplace, often sharing a meeting space as the team’s base camp – increasing the team’s trust, identity, and potential effectiveness. The pandemic made work from home at times necessary, but also led to the widespread adoption of virtual meeting platforms such as Zoom, which meant that teams no longer had to be physically together to do their jobs.

Researchers say that based on previous research, coaching and the audit review process begin to fall apart when there is less trust and more distance between coach and junior or between reviewer and preparer. They also note that it is not clear whether a virtual meeting can maintain a sense of connection.

“When team members have less trust in each other, they don’t share as much knowledge or don’t really work together, and this can eventually lead to excessive time and costs or negatively affect the quality of work.” said Tim Bauer, one of the study’s authors and a professor of security at the University of Waterloo. “So for business, audit or otherwise, the question is, how do you build that trust or identity within a work team if your members interact primarily through screens and are ‘out of sight’ as soon as you turn Zoom off?”

Regarding the potential impact on the public and the economy, Bauer added: “It’s interesting because trust is also vital for consumers of financial information. Can you trust that a company’s financial statements are reliable and honest? Efficient and effective audits build trust in this information. If the audit process suffers from the physical dispersal of team members or the sharing of virtual information, then the quality of financial information may also suffer. And if public confidence in auditors or audited information erodes, then trade, investment and borrowing will begin to decline to a halt. “

Researchers, such as Bauer and his co-authors, are beginning to look at both the negative and positive disruptions of COVID-19 in work processes and how this can affect working relationships between colleagues, such as audit teams or between organizations such as auditors and clients.

As the world begins to adapt to a post-pandemic environment, Bauer and his colleagues hope to inspire further research and discussion so that, as a community, answers to these questions, within work and in other contexts, can be given in a more systematic way. and an informed way to guide and support the future of group work and interactions.

The study, group assessment and audit decision-making: Research during and after COVID-19 by Bauer and UNSW researchers Kerry A. Humphries and Ken T. Trottman was recently published in Audit: Journal of Practice and Theory.

The study finds that at least some audit experience is applied in industry sectors

More information:
Tim D. Bauer et al., Group Assessment and Decision Making in Auditing: Research During and After COVID-19, AUDIT: Journal of Practice and Theory (2021). DOI: 10.2308 / AJPT-2020-147

Provided by the University of Waterloo

Quote: COVID-19 negatively affected the way auditors work (2022, 9 May), retrieved on 10 May 2022 from

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