
doi: 10.1111/abac.70008
Regulatory and standard‐setting bodies are engaging in stakeholder consultation on connectivity, a practice to connect sustainability‐related disclosures with financial statements. We provide empirical evidence of the impact of reporting connectivity on auditors, which is important as several revised Public Company Accounting Oversight Board Auditing Standard (ASs) and International Standards on Auditing (ISAs) highlight the importance of understanding sustainability‐related financial disclosures for auditors. We find a positive association between the level of connectivity and audit quality, as well as audit fees. This suggests that sustainability‐related financial disclosures are useful to auditors but increase the complexity of their work. Additional analyses reveal that the observed effects are contingent on the financial materiality of sustainability‐related issues to the business.
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