This study examines the interaction of audit firm characteristics with two core earnings management tools: classification shifting (CS) and core accruals management (CACM). CS occurs when management intentionally misclassifies recurring operational expenses as special items to inflate...

We investigate how audit firm size and large auditor-provided non-audit services (NAS) affect accruals quality around large equity issues and acquisitions for Norwegian public companies from 1999-2013. We find poorer accruals quality around large equity increases. Big 4 audit firms mitigate...