Audit quality: an analysis of audit partner cultural proximity to client executives

Anh Viet Pham, Mia Hang Pham, Cameron Truong

Research output: Contribution to journalArticleResearchpeer-review

6 Citations (Scopus)


We find that cultural proximity between auditors and CFOs is associated with audit quality. We use recent mandated PCAOB disclosures of engagement audit partners to construct cultural proximity between engagement audit partners and client executives. Building on an extensive literature on homophily in social connections, we hypothesize that when an engagement audit partner is culturally close to client executives, the accounting negotiation is more efficient, resulting in higher audit quality. Consistent with this prediction, we find that audited earnings are of higher quality when the engagement audit partner is culturally close to the CFO. We, however, do not find similar evidence when the engagement audit partner is culturally close to the CEO. Our findings are consistent across several alternative measures of audit quality and cultural proximity. These findings suggest that interpersonal factors from the auditor–client relationship are important for audit outcomes. Our study supports the PCAOB’s position that mandatory disclosures of engagement audit partner identity are helpful in understanding audit quality.

Original languageEnglish
Pages (from-to)841-873
Number of pages33
JournalEuropean Accounting Review
Issue number4
Publication statusPublished - 2023


  • Audit partner
  • Audit quality
  • CEOs
  • CFOs
  • Cultural proximity
  • Reporting quality

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