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Literature reviews can potentially contribute to our knowledge and understanding of a particular topic. However, consistent with anecdotal evidence, we document that literature reviews in auditing are of low quality in implementing best practice guidelines for conducting and reporting systematic reviews. We rely on existing guidelines and best practices in other domains to offer accounting researchers a step-by-step guide for conducting and reporting systematic literature reviews. We hope this guide will help to improve the quality of literature reviews in accounting and the assessment of such reviews by editors and reviewers.

We conduct three experiments to examine the implications of corporate apologies on investors' reactions to allegations of financial misconduct. In Experiment 1, we manipulate whether the firm apologizes or denies the misconduct. Additionally, we manipulate how the firm apologizes for (denies) the misconduct by comparing “basic” response strategies (i.e., responses containing nothing more than a simple apology or denial) with “full” response strategies (i.e., responses containing additional elements, such as explicitly naming the misconduct). We find that investors are less willing to invest when the firm apologizes than denies it. Using mediation analysis, we find that when investors observe an apology, they attribute more responsibility to the management for the events, leading to a lower perception of credibility and a higher perception of litigation risk, ultimately affecting their investment judgment. Our results do not provide evidence that more extensive responses affect investors differently than more basic apologies or denials. In Experiment 2, we investigate self-disclosure as a potential strategy for firms to mute investors' negative reactions to apologies. Our results replicate the findings of Experiment 1. However, we do not find evidence that management can attenuate the adverse effects of apologizing for misconduct by self-disclosing the misconduct. In Experiment 3, we separate whether the apology includes an acceptance of responsibility or not and whether there is subsequent evidence of guilt or evidence of innocence. Surprisingly, investors do not react more favorably to apologies (with or without acceptance of responsibility) than denials, even when evidence substantiates the allegations. Overall, our study demonstrates that it is difficult for managers to attenuate the negative effects of financial misconduct on investors’ perceptions with apologies.

In this paper, we assess the existing archival research on audit partners and provide recommendations for future research. Our empirical analyses suggest that the audit partner characteristics with the biggest impact are industry specialisation and client importance. We demonstrate that audit partner studies may suffer from omitted variable bias if they study audit partner characteristics in isolation, as they have often done. We also show that, for most audit partner characteristics, there is little within-company and within-partner variation. We therefore caution against routinely including company and audit partner fixed effects in audit partner studies. We also examine the importance of properly adjusting for dependence in the data in audit partner studies and suggest to cluster standard errors at the client firm level. Finally, we provide detailed descriptive information at the audit partner level in order to demonstrate how researchers could improve the reporting of audit partner level data.