Professor David Hay
David Hay is Professor of Auditing at the University of Auckland Business School, based in the Department of Accounting and Finance, and recent recipient of a 2021 Research Excellence Award from the School. We asked David to tell us a bit about his research and why it’s important.
Tell us a bit about your research
A few years ago, I was the only person actively researching auditing in New Zealand. That meant I needed to do a lot of work collecting what was known about auditing from research in other countries. It led to my two main areas of research: exploring what is unique about auditing in New Zealand and synthesizing what is known about auditing worldwide. The research includes issues like what effect does it have when auditors are also consultants for the same clients that they audit, and what effect do changes in regulations have.
The International Ethics Standards Board for Accountants brought me to New York to advise them on auditing ethics and auditors’ fees; later the American Accounting Association Auditing section awarded its Notable Contribution to the Auditing Literature Award to my co-authors and I for a meta-analysis paper.
Why is it important?
Auditing is about how accounting and business can go wrong - which happens a lot. Auditors are often criticised for what has happened in company failures, and the profession does try to improve itself in response. There are waves of reform, for example after the high-profile collapses of finance companies in New Zealand. Reforms to auditing are sometimes made without much understanding of what the problems are, but in recent years regulators are more inclined to make changes that are based on research. They want to be able to say that they conduct evidence-based standard setting. In many areas of auditing there is still not enough relevant research that they can use. More and better auditing research studies will help, and they can reduce the negative impact on New Zealanders of poor business practices.