This study uses a unique institutional setting in China to investigate empirically the association between the organizational form of CPA firms (unlimited liability versus limited liability) and the reporting conservatism of auditors. Based on a sample of 5,007 audits of Chinese listed companies...

We examine auditor independence in the banking industry by analyzing the relation between fees paid to the auditors and the extent of earnings management through loan loss provisions (LLP). We also examine whether this relation differs across large banks whose managements are required under the...

An important aim of the Sarbanes-Oxley Act (SOX) was to reduce cost of capital by enhancing auditor independence. However, prior literature has argued that SOX has been ineffective in meeting this objective. We contribute to this debate by first providing evidence suggesting that auditor...

To what degree are audit fees for U.S. firms with publicly traded equity higher than fees for otherwise similar firms with private equity? The answer is potentially important for evaluating regulatory regime design efficiency and for understanding audit demand and production economics. For U.S....

Using a sample of audit firm mergers in China's audit market, this paper provides evidence on the way auditor independence can be improved following audit firm mergers as a result of a change in the aggregate quasi rents that are exposed to risk (i.e., the quasi rents at stake). This setting...

While the accounting literature implies that increased discretionary accruals follow auditor changes, the underlying causal mechanism of this increase remains unclear. The potential reasons are the loss of the auditor's firm-specific knowledge or the firm's opportunistic choice of a new auditor....

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...

Engendering greater regulatory scrutiny and political costs, client publicity can expose auditors to higher risks. Using the changes in clients' publicity caused by their controlling owners' presence on the Hurun Rich List (rich listing) in China, we test the hypothesis that auditor conservatism...

To what degree are audit fees for U.S. firms with publicly traded equity higher than fees for otherwise similar firms with private equity? The answer is potentially important for evaluating regulatory regime design efficiency and for understanding audit demand and production economics. For U.S....

A recently published academic study by Causholli, Chambers, and Payne (2014) brings new evidence to a long-standing debate about whether the provision of non-audit services (NAS) can impair auditor independence. Prior research on this question has largely found no evidence of lower financial...