Judgment and decision-making in accounting related to auditing and financial reporting
Academic Degrees
PhD, University of South Carolina, 2020
BSBA, University of South Carolina, 2013
Professional Experience
Scott + Company, Audit Associate, August 2014 – July 2015
EY, Audit Staff 1, October 2013 – August 2014
Certified Public Accounting (CPA), Ohio (inactive status)
Selected Publications
Judge, S., Goodson, B, and Stefaniak, C. (2024). Audit firm tenure disclosure and nonprofessional investors' perceptions of auditor independence: The mitigating effect of partner rotation disclosure. Contemporary Accounting Research, 41(2), 1284-1310.
Abstract
In 2017 the PCAOB began requiring audit firm tenure disclosure within the audit report for SEC registrant clients. Many commenters raised the concern that prominent disclosure of firm tenure would lead investors to inappropriately infer a negative relation between audit quality and long tenure. This is particularly troubling given that empirical evidence generally does not support this concern. In our first experiment, we predict and find that disclosing an audit firm’s long tenure within the audit report increases investors’ perceptions that the audit firm’s independence was impaired while conducting the audit. However, we also identify an intervention that mitigates the effects of disclosing long tenure—an accompanying disclosure in the audit report of the firm’s adherence to the SEC’s mandatory partner rotation requirement. We find that such a disclosure moderates the effect of long tenure disclosure such that in the absence (presence) of a partner rotation disclosure, investors do (not) perceive increased independence impairment when long firm tenure is disclosed. In a second experiment, we predict and find that long firm tenure disclosure reduces investors’ preference to invest in an otherwise quantitatively optimal investment and that this relation is driven, in part, by perceptions of independence impairment. Again, this result is attenuated by partner rotation disclosure. Our results should be useful to regulators in understanding the effects of their disclosure mandate and to audit firms in understanding a practical way in which they might mitigate the implications of such effects.
Judge, S., and Thompson, K. (2024). Public Accounting’s Gender Ledger: Where Should Audit Firms Target Their Gender Initiatives to Better Balance Representation? Business Horizons, in press.
Abstract
Although men and women enter the public accounting profession at similar rates, women are not equally represented at the highest leadership levels. One possible contributor to the gender gap is that women and men enter the profession with differing levels of fit with the profession, which is the congruence between what an employee values and what an organization values. Using survey evidence from future public accounting professionals, we find that, on average, women experience lower fit with the public accounting profession, as compared to men, in three distinct areas: Women desire the public accounting profession to be more people-oriented, less demanding, and less competitive than they perceive it to be. Based on these results, we provide suggestions for firms to implement to improve fit for women in these areas. Our findings and suggestions will allow firms to develop improved gender initiatives that can assist in reducing gender disparity in the public accounting industry.
