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    The legitimacy of new assurance providers: Making the cap...
    research summary posted July 21, 2015 by Jennifer M Mueller-Phillips, tagged 13.0 Governance 
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    Title:
    The legitimacy of new assurance providers: Making the cap fit.
    Practical Implications:

    The central concern of this paper is the struggle by newly appointed auditors for legitimacy in a discretionary assurance space. In these domains, auditors are unable to rely on their traditional state-backed monopoly of financial audit. This paper examines efforts to establish jurisdiction by parties positioned in new assurance roles. This involved negotiating a complex and challenging terrain comprising clubs seeking to push their own interests and mistrust about the proprietary of rival club’s practices and bona fides. The authors highlight practical coping mechanisms employed to boost the legitimacy of the new audit functions.

    Citation:

    Andon, P., Free, C., & Sivabalan, P. 2014. The legitimacy of new assurance providers: Making the cap fit. Accounting, Organizations & Society 39 (2): 75-96.

    Keywords:
    salary caps in sports, auditing, organizational legitimacy
    Purpose of the Study:

    As the emerging vistas of auditing in the 21st century become more diverse and far-reaching than ever, the movement of assurance beyond the traditional boundaries of the financial audit raises important questions about the extent to which conventional audit concepts can travel to new fields, as well as the receptivity of new fields to purveyors of new assurance services. Recognizing a growing interest in auditing and assurance in new audit spaces, the authors aim to investigate efforts by auditors to establish jurisdiction in new audit spaces through two in-depth field studies of the positioning of salary cap auditors in the National Rugby League (NRL) in Australia and Canadian Football League (CFL) in Canada. The salary cap auditor in each league has established himself as a respected and widely recognized figure that has been increasingly invoked as a symbol of fair-play and propriety by leaders.

    Design/Method/ Approach:

    The authors employed a comparative case study design of the role of the salary cap auditor in two high-profile professional sports leagues  the NRL in Australia and the CFL in Canada. They investigate these issues through an in-depth review of archival sources and 18 interviews with key stakeholders in the NRL and CFL salary cap. The evidence was gathered prior to 2014.

    Findings:

    In these cases, at the intersection of the fields of accounting and football, the authors identify a number of legitimating strategies employed in order to build symbolic capital for the respective auditors. These strategies take the form of practical coping mechanisms  purposive, pragmatic action aimed at resolving an immediate impediment at hand rather than some grand, overall purposeful scheme. Three important practical gambits used in both cases, although differently pursued, were:

    1. Conscious ingratiation;
    2. Sanctioning; and
    3. Appeals to fairness, a key doxic notion in both fields. 

    Despite inhabiting similar roles, the appointed auditors are shown to possess markedly different backgrounds and employ different resources, tactics and dispositions to impose themselves in their roles. In the NRL case, the selection and positioning of the auditor was importantly influenced by a drawn out ownership battle that led to deep antagonism and mistrust between factions of the game’s administration. Several interviewees talked about the premium placed on the social capital and commitment of an ‘insider’ who was widely known and respected within rugby league circles. In the CFL case, the salary cap auditor appointment was made amid ongoing concerns about the financial viability of the league. This conferred significant value on cultural capital relating to financial management, particularly in the skills attached to forensic accounting expertise.

    Category:
    Governance