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Balance Sheet Conservatism and Audit Reporting Conservatism

Kausar, Asad - 2017

conservative audit reporting helps to compensate for a lack of conservatism in the balance sheet, which arises because the GC …

Persistent link: https://www.econbiz.de/10012958597

Opening Up the ‘Black Box’ of Audit Firms : The Effects of Audit Partner Ownership on Audit Adjustments

Lennox, Clive S. - 2018

Audit firms face conflicting incentives. On one hand, they are motivated to provide high quality audits in order to protect their reputations and avoid regulatory sanctions but, on the other hand, they also need to please their clients in order to increase their revenues. We argue that these...

Persistent link: https://www.econbiz.de/10012909088

Opening up the ‘Black Box’ of Audit Firms : The Effects of Audit Partner Ownership on Audit Adjustments

Lennox, Clive S. - 2020

Audit firms need to provide high quality audits but they also need to please their clients. We argue that these conflicting incentives become manifest when comparing the incentive effects of equity ownership on engagement quality (EQ) reviewers and audit engagement partners. We predict that EQ...

Persistent link: https://www.econbiz.de/10012824024

Cooking the Books Using Different Ingredients : An Examination of Earnings Frauds That Also Involve Misreported Cash Flows

Lennox, Clive S. - 2020

Prior studies examine how fraud firms manipulate accruals in order to overstate their earnings. We document that some fraud firms also manipulate operating cash flows in order to fraudulently overstate earnings. More importantly, we predict that these earnings-cash flow frauds (ECF) are harder...

Persistent link: https://www.econbiz.de/10012835178

Perceived Competition, Profitability and the Withholding of Information About Sales and the Cost of Sales

Dedman, Elisabeth - 2011

We investigate the relation between perceived competition and voluntary disclosure in the absence of capital market incentives by examining private UK companies, which have the option to withhold sales and costs of sales information from their publicly-filed accounts. We survey managers about...

Persistent link: https://www.econbiz.de/10013121114

The Hiring of Accounting and Finance Officers from Audit Firms : How Did the Market React?

Geiger, Marshall A. - 2011

(SOX) eliminated this hiring practice, reflecting concerns that such appointments may impair audit and financial reporting … by smaller companies, and that these appointments are not associated with lower financial reporting quality when …, the low frequency of occurrence, investors' positive perceptions, and the lack of association with deteriorated reporting …

Persistent link: https://www.econbiz.de/10013121113

Auditor Tenure and Rotation

Lennox, Clive S. - 2012

This article reviews global practices on auditor rotation and discusses the pros and cons of mandatory rotation. While many studies have examined auditor tenure and rotation, I argue that the literature has not yet answered the question as to whether mandatory rotation is desirable. The reason...

Persistent link: https://www.econbiz.de/10013099043

Accounting Misstatements Following Lawsuits Against Auditors

Lennox, Clive S. - 2012

This study investigates whether financial reporting quality is affected by an auditor's experience of litigation in the …, we find an improvement in financial reporting quality subsequent to the recent litigation experiences of Big 4 offices … leads to higher financial reporting quality …

Persistent link: https://www.econbiz.de/10013100581

The Consequences of Protecting Audit Partners’ Personal Assets from the Threat of Liability

Lennox, Clive S. - 2012

This study investigates the audit firm's decision to protect its partners' personal assets by becoming a limited liability partnership (LLP). We find that the likelihood of an audit firm switching from unlimited to limited liability is increasing in its size and exposure to litigation risk. We...

Persistent link: https://www.econbiz.de/10013105840

The Demand for Audit in Private Firms : Recent Large-Sample Evidence from the UK

Dedman, Elisabeth - 2013

Although theory suggests that companies would rationally select into audit even if it were not a legal requirement, many countries impose mandatory audits. This is arguably due to an audit having elements of a public good, which may result in not enough audits being purchased without regulatory...

Persistent link: https://www.econbiz.de/10013087925