COVID-19 AND THE ACCOUNTING PROFESSION

Abstract

This is the first large-scale academic study evaluating the impact of COVID-19 on the accounting profession. We find that physical restrictions and economic hardships resulting from COVID-19 impeded accountants’ productivity, ability to perform their work, ability to maintain relationships with clients and co-workers, and ability to sell future services to prospective clients. Auditors believe COVID-19 will reduce the effectiveness of clients’ internal controls and make it more difficult for auditors to determine the effectiveness of internal controls. Auditors additionally believe that COVID-19 will make it more difficult to determine the going concern status of their clients. Tax professionals do not agree with the notions that COVID-19 will lead to increased difficulty in reporting taxable income, an increase in aggressive tax reporting, or an increase in attempted tax evasion. Results herein are of importance to accountants, educators, legislators and all users of financial statements.

“Face-to-face discussions with client personnel is very important in evaluating controls and risk of fraud and material misstatement. These meetings allow the auditor to pick up non-verbal clues and are a more comfortable environment for open discussions with client personnel. These can be performed in other ways but, in my opinion, none will be as effective as face-to-face meetings.”
                  - Anonymous Respondent