In this study, we examine how institutional ownership affects the quality and riskiness of the financial statement audit. We hypothesize that institutional investors can influence corporate policy to employ governance mechanisms that reduce their monitoring costs. Our evidence shows that firms...

Audit researchers have a longstanding interest in understanding whether issuing a going concern report to financially stressed clients protects auditors from litigation. An endogeneity issue arises, in that litigation risk affects the going concern decision and the going concern decision impacts...

Audit regulators around the world have expressed concern over market dominance by Big 4 accounting firms and the potential adverse effect it may have on the quality of audited financial statements. We use cross-country variation in the audit market structure of 42 countries to examine two...

Audit regulators around the world have expressed concern over market dominance by Big 4 accounting firms and the potential adverse effect it may have on the quality of audited financial statements. We use cross-country variation in the audit market structure of 42 countries to examine two...

This paper summarizes the Statement on Auditing Standards (SAS) No. 106 – Audit Evidence. It extends the importance on why the financial statements should be fairly stated and in conformity, in all material respects, with Generally Accepted Accounting Principles (GAAP). Also, extends why audit...

Objective - the timeliness of financial statement submission becomes important in decision making. With the growing importance of timely financial statements for the relevance of decision making, an understanding of the determinants of audit report lag becomes necessary. This research intends to...

Using data from the Chinese market where related party transactions (RPTs) are particularly prevalent, we examine how the independent auditor responds to the potentially heightened risk of RPTs and the efficacy of the auditor's response. First, we find that the auditor is more likely to issue a...

We study the determinants of involvement of component auditors (either network and/or unaffiliated) in multinational (MNE) group audits and associated audit outcomes. We identify the involvement of component auditors, using unique Australian disclosures of group audit fees paid to the principal...

Extant evidence implies that managers rely on a variety of non-income-increasing techniques to manipulate earnings. However, prior research finds that the auditor is more likely to discipline firms against practicing income-increasing (II) earnings management due to its higher litigation and...

This paper employs a difference-in-differences approach to study whether a Chinese audit firm improves its competencies through organizational learning after one of its audit teams has a client cross-listed in the US. Among a group of companies that are listed only in China, we define those...