This study examines the effectiveness of regulatory sanctions as deterrents to auditors' unethical behavior. Although the effectiveness of formal sanctions is crucial for regulators and policy makers, few empirical studies have addressed the issue. In this paper, we provide empirical evidence on...

This paper investigates the underexplored issue of whether and how firms manage their earnings when tax rates increase. We hypothesize and find that firms generally choose to manage their taxable income upward in a book-tax non-conforming manner rather than in a book-tax conforming manner before...

This study examines tax, financial reporting, and tunneling incentives on the transfer pricing decisions of Chinese listed companies. We use the relative gross profit ratios of related- and unrelated-party transactions to measure transfer pricing strategies. We find evidence supporting the view...

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...