We provide evidence on the long standing concern on auditor conflicts of interest from providing non-audit services (NAS) to audit clients by using rarely explored NAS fee data from 1978-80 Using this earlier setting, we find cross-sectional evidence of improved earnings quality when auditors...

This study examines whether political connections further impair auditor independence when auditor provides non-audit services in Malaysia. We examine whether political connections moderate the relationship between non-audit fees and audit fees. Based on two proxies of political connections...

We investigate whether auditor's mandatory rotation affects audit quality. In specific, we test the effectiveness of Ministry of Finance's (MOF) decree no. 423/2002. Following some other studies that investigate audit quality, we use discretionary accruals as the proxy for audit quality. Our...

Recent accounting scandals are the product of multiple failings of auditing, accounting, corporate governance and of the market. In discussing the many factors that led to failure, this paper attempts to provide insights on regulatory inadequacies that contributed to these problems. At the...

In modern business world, companies need to attract a large number of shareholders because of the large amount of required capital. In these companies, shareholders hire managers to direct the firm and make decisions on behalf of them because they cannot have a full control over the firm's...

This paper examines factors that influence job applicants' willingness to apply for positions in internal auditing. We predict and find evidence that job applicants are dissuaded from applying for internal audit positions. In two separate experiments involving participants at seven universities,...

In this paper we provide evidence for the effects of social norms on audit pricing by studying companies belonging to the alcohol, firearms, gambling, military, nuclear power, and tobacco industries, which are often described as “sin” companies. We hypothesize that the disparities between...

We examine which of two opposing financial reporting incentives that group-affiliated firms experience shapes their accounting transparency evident in auditor choice. In one direction, complex group structure and intra-group transactions enable controlling shareholders to pursue diversionary...

This study examines how short-selling threats affect auditors. During 2005-2007, the SEC ordered a pilot program in which one-third of the Russell 3000 index firms were arbitrarily chosen to be exempted from short-sale price tests. As a result, these stocks faced significantly higher...

We argue that audit quality has direct and indirect effects on the cost of equity capital. Direct effects are consistent with auditor reputation effects reflecting insurance and/or assurance roles. However, if audit quality is at least in part a reflection of expected assurance levels, then we...