Much of the extant audit research focuses on the impact of excess audit fees paid to the auditors on earnings management. However, there is limited empirical evidence on whether auditors tolerate earnings management when audit fees are low, i.e., below the level of normal fees. Using a large...

We conduct a comprehensive study on the associations between debt covenant violations (“violations”) and auditor actions for financially distressed and non-distressed firms. Our study is motivated by a lack of research on the consequences of violations resulting from auditors' actions. We...

Recent research challenges the notion that the Big 4 auditors provide a higher quality audit relative to non-Big 4 and suggests that the Big N effect could be due to self-selection. We contribute to this debate by controlling for pre-audit earnings quality, an important omitted variable in prior...

Recently, the SEC adopted rules for the Holding Foreign Companies Accountable Act which bars trading of securities of companies whose auditors are not inspected by the PCAOB. Currently, the PCAOB is unable to inspect the audit work papers of Chinese audit firms that audit U.S.-listed Chinese...

As a result of the global financial crisis (GFC), several audit clients were able to negotiate lower audit fees for the years 2008 and 2009. However, the PCAOB has expressed concern that lower audit fees might lead to lower audit effort and lower audit quality and financial reporting quality....

We find that even though ethnic minority audit partners (those of Asian, Black, or Hispanic origin) represent a low proportion of U.S. audit partners, audit partner ethnicity is significantly related to several important audit phenomena. Consistent with the homophily principle, ethnic minority...