Have there been any changes in the properties of accounting information of former Andersen clients following the auditor change? This study provides empirical evidence on whether earnings conservatism has increased for a sample of former Arthur Andersen clients who were forced to switch auditors...

In the post-Enron world, the spot light is on the auditors who face a higher risk of litigation. This study provides evidence on one strategy employed by auditors to mitigate litigation risk and rebuild their reputation by enhancing earnings conservatism of their clients. I examine the earnings...

Drawing on the academic literature in accounting, finance and economics, we analyze economic and policy factors related to the potential adoption of International Financial Reporting Standards (IFRS) in the U.S. We highlight the unique institutional features of U.S. markets to assess the...

We report survey evidence about 515 experiences that auditors have had with clients who they identified as attempting to manage earnings. This approach enables us to analyze separately managers' decisions about how to attempt earnings management (quot;EMquot;) and auditors' decisions about...

This document is the written testimony submitted to the House Oversight Committee for its hearing on hedge funds and the financial crisis, held November 13, 2008, and is not a formal academic research paper, but is intended for a broader audience of policymakers and regulators. Academic readers...

I review empirical (archival and experimental) accounting research that has addressed the issue of conflicts of interest, focusing on the audit setting that has received so much recent attention. I start with a brief discussion of the audit function and auditors' incentives, viewing auditors as...

Two alternative approaches are used in audit practice to make quantitative materiality assessments about proposed audit adjustments: the cumulative approach compares to net income the total amount of misstatement existing at the end of the current period, while the current-period approach...

This paper reports descriptive evidence about how managers attempt to manage earnings, based on a sample of 515 earnings-management attempts obtained from a survey of 253 experienced auditors (and also analyzed by Nelson et al. 2002). We classify attempts first according to primary approach:...