Iranian Managers’ Perceptions of the Independent Audit Report: A Qualitative Study Based on Thematic Analysis

Abstract

This study aimed to develop a qualitative thematic model explaining how Iranian managers perceive, interpret, and respond to independent audit reports, with particular attention to the conditions shaping interpretation, the strategies used to resolve ambiguity, and the consequences of this interpretive process. This qualitative study employed an exploratory–interpretive design and thematic analysis. Participants were purposively selected from accounting and auditing experts and senior managers of companies listed on the Tehran Stock Exchange. Data were collected through in-depth semi-structured interviews lasting approximately 65–90 minutes and were audio-recorded and transcribed verbatim with participants’ consent. Data analysis followed the six-phase thematic analysis approach, including familiarization with the data, initial coding, generation of themes, review of themes, definition and naming of themes, and preparation of the analytical report. Coding was conducted iteratively, and methodological rigor was strengthened through independent coding of a sample of interviews, comparison between coders, consensus-based resolution of discrepancies, and documentation of the analytical process. The findings revealed an integrated interpretive model consisting of six dimensions: causal conditions, the central phenomenon, contextual conditions, intervening conditions, strategies and interactions, and consequences. Unusual audit content functioned as a threshold trigger that shifted managers from routine reading to active interpretation. The central interpretive task involved decoding the seriousness and practical meaning of audit opinions. Organizational structures, especially active audit committees and access to financial expertise, facilitated understanding, whereas individual accounting knowledge, regulatory pressure, trust in the audit firm, and prior experience shaped interpretive responses. Managers used direct auditor communication, referral to specialists, selective reading, and organizational meetings to resolve ambiguity. These processes influenced decision quality, audit literacy, and trust in the auditing process, while accumulated experience created a gradual learning feedback loop. Managers’ understanding of independent audit reports is a dynamic and iterative process shaped by textual signals, individual expertise, organizational context, institutional pressures, interaction with professional intermediaries, and cumulative learning; therefore, improving audit-report usefulness requires attention not only to technical accuracy but also to comprehensibility and interpretive support.