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The Determinants and Consequences of Copying the Auditor on SEC Comment Letter Correspondence

Ryan Ballestero & J. Michael Schmidt

Auditing: A Journal of Practice and Theory2026https://doi.org/10.2308/ajpt-2024-033article
AJG 3ABDC A*
Weight
0.50

Abstract

SUMMARY We investigate when companies copy auditors on SEC comment letter correspondence and whether copying the auditor affects comment letter resolution. We find that companies are more likely to copy the auditor when there is a need for the auditor's expertise (i.e., the SEC's comment letter references an accounting topic). Copying the auditor is associated with quicker company responses to the SEC, and copying a more experienced auditor is associated with quicker SEC responses. Copying more experienced auditors is also associated with a greater (lower) likelihood that the comment letter is resolved through a revision (restatement). Finally, with respect to potential mechanisms, copying the auditor is associated with clearer company responses, more references to accounting authoritative guidance, more references to previous phone calls with the SEC, fewer requests for extensions, and higher audit fees. Overall, our results suggest that companies benefit from copying the auditor in comment letter responses. Data Availability: All data used in the study are publicly available from sources cited in the text. JEL Classifications: M42; M48.

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https://doi.org/https://doi.org/10.2308/ajpt-2024-033

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@article{ryan2026,
  title        = {{The Determinants and Consequences of Copying the Auditor on SEC Comment Letter Correspondence}},
  author       = {Ryan Ballestero & J. Michael Schmidt},
  journal      = {Auditing: A Journal of Practice and Theory},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.2308/ajpt-2024-033},
}

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The Determinants and Consequences of Copying the Auditor on SEC Comment Letter Correspondence

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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

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.