Processing Change: A Qualitative Study Examining the Frontstage and Backstage of Audit Firms Contemplating the Implementation of Critical Audit Matters

This study explores the mindset of US auditors as they process implementation of critical audit matter (CAM) disclosures. Through the lens of Goffman's self‐presentation theory, I examine audit firm ‘frontstage’ public comments, contrasted with ‘backstage’ interviews of eight Big 4 and eight non‐Big 4 auditors prior to the release of the final CAM standard. I find that frontstage and backstage, non‐Big 4 auditors are consistent in their lack of support for CAM disclosure. Alternatively, Big 4 firm frontstage comments are generally supportive of CAM disclosure and reflect pressure to maintain report relevance, consistent with what institutional theory describes as coercive isomorphism. Backstage, Big 4 auditors are equally as critical of CAM potential for effectiveness as non‐Big 4 auditors. I also find that backstage, both Big 4 and non‐Big 4 auditors express a preference for standardized CAMs, signalling that despite Big 4 public support, the effectiveness of CAMs may be reduced.