Internal auditors often perform work that is relevant to their host entities' financial reporting processes, yet little research attention has focused on the effects of internal auditing on companies' external financial reporting. Using a unique and previously unavailable data set, we...

We review recent behavioral studies of the effects of regulation on earnings management and accounting choice. Our review examines the impact of financial reporting, auditing, and other corporate governance regulations on the beliefs and choices of managers, auditors and corporate directors....

We examine whether firms with managers that have prior internal audit experience are less likely to manage earnings. We find that firms with managers that have internal audit experience are associated with less overall earnings management, driven by lower real earnings management. Importantly,...

This study provides evidence concerning the significance of assessing operational control risks as part of an integrative evaluation of internal controls. We examine whether operational control weaknesses can be used as cues to potential unreported financial reporting control weaknesses, and in...

In this paper we investigate the relation between audit committee quality, auditor independence, and the disclosure of internal control weaknesses after the enactment of the Sarbanes-Oxley Act. We begin with a sample of firms with internal control weaknesses and, based on industry, size, and...

Previous studies have focused on accounting measures, such as earnings management and discretionary accruals, in evaluating the effects of auditor compensation on disclosure quality. In contrast, we investigate the impact of fees paid for audit and non-audit services on a market-based measure of...

The Sarbanes-Oxley Act (SOX) prohibits companies from outsourcing internal audit work to their external audit provider. Competing predictions on the effects of this prohibition stem from two academic arguments relating to the provision of nonaudit services by the external auditor: knowledge...

The objective of this study is to extend the current literature related to non-audit services by investigating the area of internal audit outsourcing to the external auditor. We posit that certain types of internal audit outsourcing (i.e. those which are non-routine, and thus tend to be...

This paper considers both the inherent risks and perverse incentives for executives, when accounting systems are upgraded, legacy systems decommissioned and accounting data migrated, as well as regulatory steps needed to preserve the forensic accounting record

Motivated by mixed findings in the auditing literature about the importance of related party transactions as red flags indicating potential fraud, this study examines 83 SEC enforcement actions involving both fraud and related party transactions. In addition to comparing the characteristics of...