In auditor we trust: 44 years of research on the auditor-client relationship and future research directions

Abstract

This study aims to review the auditor-client relationship (ACR) literature spanning 1976 to 2019 to provide future research directions. The study analysed 140 articles from the Web of Science database, authored by 259 scholars across 28 countries and published in 47 journals. It identified three major research streams to understand the ACR dynamics: auditor tenure, ACR attributes and auditor-client negotiation. Three major findings emerged based on this review. First, few studies examine auditor-client negotiation relative to other streams; thus, it offers scope for further research. Second, given that various fields have used diverse frameworks as theoretical underpinnings in prior studies, continuing this trend can better portray ACR from multiple perspectives. Finally, despite strong international regulations on ACR aspects such as auditor independence, tenure and rotation, implementation in several countries warrants special considerations, specifically on legal enforcement and investor protection, given diverse cultures and country-level institutional environments. This study contributes to the synthesis of existing and emerging research streams and provides future research suggestions.