I examine whether bank regulators and external auditors have conflicting effects on loan loss provision timeliness, an accounting choice associated with important economic consequences and a potential conflict between regulators and auditors. In the absence of the other group, auditors and...

This study examines credit lending decision adjustments of executive board members of German banks following different levels of auditor materiality threshold disclosures. Based on an experimental research design, we find that if a materiality threshold, which is in line with current audit...

This study examines the relation between country-level audit profession development (APD) and bank loan contracting around the world. Using a sample of bank loan data from 35 countries, we find that stronger APD is associated with more favorable loan terms, such as lower loan spreads, fewer...

We examine how auditors’ use of limited liability agreements (LLAs) impact perceptions of private company creditworthiness in a 2×2 between-subjects experiment. Ninety-three United States-based bank loan officers evaluate whether LLA clauses and the size of the company’s external auditor...

Exploiting the staggered state-level adoption of the Riegle-Neal Interstate Banking and Branching Efficiency Act (IBBEA), we examine whether and how banking deregulation affects firms’ auditor choices. We find that an exogenous increase in the degree of interstate branch banking deregulation...

Starting in October 2013, auditors of premium-listed firms in the United Kingdom are mandated to prepare an expanded auditor’s report that provides details on audit procedures, risks of material misstatement (RMMs), and materiality thresholds. This regulatory change is important to study,...

This paper empirically examine whether the way African banks use loan loss provisions to smooth earnings is influenced by capital market motivations and the type of auditor after controlling for non-discretionary determinants of loan loss provisions and fluctuations in the business cycle. The...

We examine how auditor reputation conditions the market valuation of banks' loan loss provision (LLP). The inherent uncertainty associated with and discretion permitted in estimating the LLP contributes to information asymmetry. The auditor's certification and monitoring roles influence firm...

In this study, we examine whether banks' use of the loan loss provision (LLP) to manage earnings is associated with 1) the extent to which banks hold assets subject to fair value reporting and 2) the use of an industry specialist auditor. We find that banks with a greater proportion of assets...

In the syndicated loan market, potential accounting errors exacerbate credit risk and asymmetric information problems. The purpose of financial statement audits is to provide reasonable assurance that accounting records are free from material errors. In this paper, we examine whether an increase...