The Effect Of Audit Opinion Signature On A Jury'S Perception Of Negligence

New regulation by the Public Company Accounting Oversight Board (PCOAB) and the International Auditing & Assurance Standards Board (IAASB) regarding changes to the way audit opinions are signed has resulted in very different outcomes. The PCAOB requires audit firms to report the audit partner's name on Form AP, which is available on the PCAOB website. The IAASB, on the other hand, requires mandatory disclosure of the audit partner on the audit opinion. Opponents argued that requiring partner signature would increase liability. Based on a scenario depicting fraudulent activity, assessed jury negligence is higher when the partner signs their name to the audit opinion than when they sign their firm's name when measuring both partner and firm negligence. Firm size was assessed but found to be insignificant. Finally, we examined the effect of psychological contract violation theory in relation to the audit opinion signature method, with results suggesting the relationship between signature method and perceived auditor negligence is mediated by trust.