An Investigation into the Audit Committee’s Evaluation of the Auditor

We report findings from interviews with audit committee members, auditors, and company managers on the practices audit committees follow to evaluate the auditor. We show why the practice documented in prior research is set up to produce an evaluation of the audit partner’s ability to achieve an alignment of views with management, but not much else. We also describe other, newer practices, and we draw on Callon and Muniesa’s (2005) definition of calculation to analyze how they are set up to expand the evaluation. These practices entail using evaluation forms that ask audit committees to consider a set of questions about the auditor. Our analysis shows how the questions can expand the evaluation by including in it not only the partner, but also the rest of the engagement team. This is relevant because the questions can reveal surprises that result in meaningful changes to the resources assigned to the engagement.