Accounting accruals are based on subjective estimates and are therefore more uncertain and difficult to audit than many of the components of financial statements. One strategy auditors have to deal with the risk associated with this problem is to lower their threshold for issuing qualified audit...

This study investigates if the likelihood of hiring a Big 6 auditor is increasing in the firm's endogenous propensity to generate accruals. High-accrual firms have greater scope for aggressive and/or opportunistic earnings management and therefore have an incentive to hire a brand name Big 6...

We show that when banks and borrowers share the same audit firm, borrowers receive lower interest rates, after controlling for potentially confounding director connectedness. The common auditor effect is observed only for opaque borrowers, and is greatest when the same audit engagement office...

Recent research documents that common law countries have stronger investor protection laws and more developed financial markets than civil law countries (La Porta et al., 1997, 1998). This line of inquiry is extended in our study to examine if variations in legal systems also affect accounting...

<heading id="h1" level="1" implicit="yes" format="display">ABSTRACT</heading>This paper examines whether a country's corporate transparency environment, which includes the quality of accounting information, contributes to efficient resource allocation. Based on a cross-country study of 37 manufacturing industries in 37 countries, we provide three pieces of...