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Financial Statement Audit and Crisis Response among Small Businesses during COVID-19: An International Study

Tyler P. Carlson et al.

Journal of International Accounting Research2026https://doi.org/10.2308/jiar-2024-057article
AJG 2ABDC A
Weight
0.50

Abstract

This study examines whether private small and medium-sized enterprises (SMEs) that voluntarily commissioned financial statement audits before the COVID-19 pandemic are better equipped to navigate pandemic-era operational challenges, access financial support, and reduce business disruptions. Using survey data from the World Bank, we find that audited SMEs exhibit greater operational responses to the pandemic and enjoy enhanced access to finance. These factors lead to fewer weeks of temporary closure than their unaudited peers. Further analysis reveals that this effect is stronger in environments of higher information asymmetry. We also find evidence suggesting that audited firms facing stricter COVID-19 policy stringency or receiving less government assistance exhibit greater operational adjustments. The results are robust to entropy balancing, and Heckman specifications. Overall, this study provides novel insights into the influence of financial statement audit on business resilience during a macroeconomic crisis. Data Availability: Data are available from the public sources cited in the text. JEL Classifications: D24; M42; M8.

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https://doi.org/https://doi.org/10.2308/jiar-2024-057

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@article{tyler2026,
  title        = {{Financial Statement Audit and Crisis Response among Small Businesses during COVID-19: An International Study}},
  author       = {Tyler P. Carlson et al.},
  journal      = {Journal of International Accounting Research},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.2308/jiar-2024-057},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

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