This paper examines the effect of managerial legal liability coverage on earnings conservatism. Using directors' and officers' (D&O) liability insurance coverage and cash for indemnification as a proxy for managerial legal liability coverage, we find that the higher the managerial liability...

Purpose –This study aims to examine the association between corporate governance and audit fees using directors' and officers' (D&O) insurance premiums as a proxy for overall governance quality. The use of an overall governance measure that captures both structural and non-structural...