This paper studies the factors that affect a firm's choice to dismiss or remain with their incumbent auditors when faced with adverse auditor opinions on the design and effectiveness of their internal controls. The study focuses on a unique sample of firms that received an adverse opinion in one...

We synthesize the literature on auditors' evaluation of, and reporting on, internal control over financial reporting (ICOFR), as required by the Sarbanes-Oxley Act. The purpose of the synthesis is (1) to provide information on how and how well auditors perform the task, which serves as feedback...

This paper seeks to provide empirical evidence on the efficacy of three important governance mechanisms (auditors, directors, and institutional shareholders) in constraining aggressive financial reporting, proxied by abnormal accruals. It also examines the effects of the Sarbanes-Oxley Act (SOX)...

The rise of fraud companies led the investors to hide from the market, and thus, the flow of investment in the trading market reduced dramatically. The Accounting Committee needed to stop the misconduct of the companies in providing false financial statements. Therefore, Sarbanes-Oxley Act (SOX)...

Internal control over financial reporting (ICFR) audits have been the subject of intensive examination by the Public Company Accounting Oversight Board (PCAOB) and researchers, and the SEC has signaled ongoing interest in the monitoring of ICFR. However, the process through which auditors make...

This study examines the effect of the Sarbanes-Oxley Act of 2002 (SOX) on accounting distortions in the context of the earnings quality of high-growth firms relative to lower-growth firms. High-growth creates unique management and reporting challenges that can contribute to accounting-related...

Offshoring of accounting processes has become a common business practice, pursued by firms to reduce costs and focus on core competencies. However, our understanding about internal controls of these offshored processes is limited. Grounded in theory that is supported by prior literature and...