An experimental examination of the effect of client size and auditors’ industry specialization on time pressure in Australia

Abstract

This paper examines how industry specialization and the size of the client affect time pressure to complete an audit. The study used a sample size of 70 auditors to examine their perceptions of time pressure in different scenarios. The results of the experiment demonstrate that industry specialization significantly reduces the level of time pressure, indicating that industry specialist auditors work more efficiently and face less time pressure compared with non-specialist auditors. No significant relationship exists between the size of the client and time pressure, indicating that audit firms are likely to possess stronger bargaining power and resist pressure from clients to reduce audit hours when auditing large companies.