Auditor Experience and the Timeliness of Litigation Loss Contingency Disclosures*
研究发现，由城市行业专长审计师审计的公司，在管理层披露前没有相关法律案件新闻报道时，能更及时地披露诉讼或有损失。这归因于专长审计师在相同办公室和行业中审计过涉及诉讼的客户所积累的经验。
ABSTRACT This paper hypothesizes and finds that firms audited by city‐industry specialists have more timely disclosures of contingent losses from litigation when there is no news coverage relating to the legal case prior to management disclosures. A closer examination reveals that this result is explained by the specialist auditors’ prior experience auditing clients in the same office and industry who are involved with litigation. In our setting, disclosures of litigation‐related contingent losses, we identify two kinds of knowledge generated from experience: industry knowledge and litigation knowledge. Industry knowledge helps auditors detect and correct poor implementation of guidance for litigation loss contingency disclosures. Auditors gain litigation knowledge from auditing clients in a given office and industry with previous involvement as defendants. Thus, the two types of knowledge interact in their effects on reporting outcomes.