Drawing on social norms and social learning theories, this study investigates the influences of peer (similar) firms' prior choices on whether or not a client chooses to affiliate with a “social norm” audit office in its metropolitan area, following auditor turnover. The office in a metro...

This study investigates whether auditors' independence was compromised by client audit fee pressures during the recession of December 2007 through June 2009. We hypothesize that clients able to extract fee concessions from auditors during the recession, when audit risk increased, might also have...

Prior research argues that one reason firms engage in corporate spinoffs is to increase firm value by reducing information asymmetry with shareholders (the “information hypothesis”). However, the literature has yet to identify a mechanism through which this reduction in information asymmetry...

We propose a new audit supplier competition construct: the Office-Client Balance (OCB), which consists of the relative abundance of suppliers (competing audit offices) and customers (audit clients) in a metropolitan (metro) area. From this construct, we derive a metro-level audit competition...

Prior studies have theoretically and empirically documented that incentives to disclose information involve a trade-off between the benefits to the corporation of reducing information asymmetry and the costs of revealing proprietary information. This study investigates the interplay of managers'...

Positive accounting theory predicts that conservative financial reporting averts GAAP-based litigation. However, very little empirical evidence addresses whether and how accounting conservatism provides these benefits. Using a sample of lawsuits against public companies for alleged violations of...

We examine whether Basu's (1997) differential timeliness metric and the related C-Score metric are effective in detecting predictable differences in conservatism surrounding corrections of overstated earnings. Cross-sectional and time-series analyses, employing 2,132 firms making restatements...

We study the association between firms' disclosures in Forms 10-K of the existence of trade secrets, and cyber theft of corporate data (which we refer to as “Breaches”). Prior academic research explaining occurrence of Breaches is scarce, and no prior study has focused specifically on...

Prior studies have theoretically and empirically documented that incentives to disclose information involve a trade-off between the benefits to the corporation of reducing information asymmetry and the costs of revealing proprietary information. This study investigates the interplay of managers'...

While many audit firms have adopted electronic systems for workpaper preparation and review in hopes of improving both efficiency and effectiveness, prior research shows that the expected gains may be difficult to achieve. In order to investigate possible sources of difficulty in full use of...