Stress and Auditing Quality

Abstract

This thesis aims to investigate the relationship between auditors' perceived stress and audit quality and to identify potential consequences of this relationship. With a focus on understanding how stress affects auditors' work and how it can impact audit quality, as well as what can be done to mitigate it, it is evident that a thorough analysis of this complex relationship is needed.
The thesis begins by defining stress and audit quality. Audit quality is complex and involves more than just formal standards. By employing various approaches, different perspectives of audit quality are illuminated, including compliance with standards and financial analysis. The IAASB's framework for audit quality is presented as a useful tool, but challenges in definition underscore its complexity. Stress in the audit profession is a serious challenge, as data clearly indicates. Stress primarily stems from long working hours, poor management, and an imbalance between work and personal life for auditors. An analysis from FSR and an article from Finans, as well as the identification of 16 stress factors, underscore auditors' significant dissatisfaction with workload and the negative work culture contributed to by conservative management style. These findings provide a deeper understanding of the current challenges in the audit profession regarding stress.
Next, an analysis was conducted to determine if there is a relationship between stress and audit quality. The analysis examined the connection between stress and audit quality using a questionnaire distributed to auditors, resulting in 53 respondents. The respondents' average stress level was 5.54 out of 10. However, the analysis of response variance revealed significant variation in stress experiences, indicating that some handled stress better than others. Although there was a correlation between stress level, position, and age, many auditors managed to maintain high audit quality despite significant stress. This suggested that the relationship between stress and audit quality was not direct.
Finally, a discussion was held on what has been done and what can be done in the future to avoid stress in the workplace and in the audit profession. The discussion emphasized the need for a comprehensive approach to managing stress in the workplace, especially in the audit profession. While progress has been made through initiatives such as changing work culture and stress management programs, more effective strategies are still required. Companies like Deloitte and PwC have been proactive, but there is a need to explore and implement new measures, such as resource allocation, process optimization, and strengthening leadership quality.
This thesis concludes that stress management in the workplace, especially in the audit profession, is complex and requires a comprehensive and ongoing effort. While progress has been made in addressing stress through initiatives such as changing work culture and stress management programs, more effective strategies are still needed. The analysis shows that although there is a widespread belief that high levels of stress can lead to poorer audit quality, there is not necessarily a direct correlation. Many auditors still manage to maintain high quality in their work despite significant stress.