Institutional pressures and strategic responses to safeguarding audit quality in a crisis-disrupted environment

Abstract

Motivated by the pressing question of whether audit quality can be safeguarded during systemic crises, this study examines how institutional pressures shape auditors’ actions and professional judgments in a developing-country context. Drawing on the audit quality framework, which conceptualizes audit quality through its inputs, processes, and outcomes, the study explores how each dimension was reconfigured during the COVID-19 disruption. Using an interpretivist qualitative approach, interviews were conducted with 15 audit partners and managers from the Big Four firms in Ghana. The findings reveal that audit inputs, including auditor competence, ethical judgment, and resource capacity, were stretched by lockdown restrictions and heightened uncertainty. Audit processes, encompassing planning, risk assessment, evidence gathering, and going-concern evaluations, underwent significant adaptation through remote technologies, analytical procedures, and scenario-based testing. Meanwhile, audit outcomes, particularly the tone and content of audit opinions, reflected a more cautious and judgment-driven approach aimed at maintaining legitimacy and public confidence. Institutional theory helps explain how auditors responded to coercive, normative, and mimetic pressures through acquiescence and compromise strategies, balancing conformity with professional innovation to safeguard audit quality. Overall, the study advances understanding of how crises reshape audit work by highlighting the emergence of hybrid audit practices that blend compliance, technology, and professional discretion to preserve the credibility and reliability of financial reporting under systemic uncertainty.