Non Audit Service Fees And Audit Quality
DOWNLOAD
Download Non Audit Service Fees And Audit Quality PDF/ePub or read online books in Mobi eBooks. Click Download or Read Online button to get Non Audit Service Fees And Audit Quality book now. This website allows unlimited access to, at the time of writing, more than 1.5 million titles, including hundreds of thousands of titles in various foreign languages. If the content not found or just blank you must refresh this page
Non Audit Service Fees And Audit Quality
DOWNLOAD
Author : Chee Yeow Lim
language : en
Publisher:
Release Date : 2013
Non Audit Service Fees And Audit Quality written by Chee Yeow Lim and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013 with categories.
Recent studies on whether the provision of non-audit services impairs audit quality document mixed results, depending on the proxy for auditor quality used. We posit that the effect of non-audit fees on audit quality is conditional on auditor industry specialization in that audit quality is less likely to be impaired in the case of industry specialist auditors providing non-audit services. Our premise is that industry specialist auditors are more likely to be concerned about reputation losses and litigation exposure, and to benefit from knowledge spillovers from the provision of non-audit services. We find some evidence that audit quality (as measured by increased propensity to issue going-concern opinion, increased propensity to miss analysts' forecasts, as well as higher earnings-response coefficients) is less likely to be reduced for firms that acquire non-audit services from industry specialist auditors compared to non-specialist auditors. Implications are discussed.
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality Classic Reprint
DOWNLOAD
Author : Richard M. Frankel
language : en
Publisher: Forgotten Books
Release Date : 2018-03-03
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality Classic Reprint written by Richard M. Frankel and has been published by Forgotten Books this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018-03-03 with Business & Economics categories.
Excerpt from The Relation Between Auditors' Fees for Non-Audit Services and Earnings Quality This paper provides empirical evidence on the relation between non-audit services and earnings quality. We test hypotheses concerning: (1) the association between a firm's purchase of non-audit services from its auditor and earnings management, and (2) the stock price reaction to the disclosure of non-audit fees. In the past decade there has been a dramatic increase in the proportion of fee revenue auditors derive from non-audit services, yet we know little about how non-audit services are related to earnings quality.1 Concern about the effect of non-audit services on the financial reporting process was a primary motivation for the Securities and Exchange Commission (sec) to issue revised auditor independence rules on November 15, 2000. The rules require firms to disclose the amount of all audit and non-audit fees paid to its auditor. About the Publisher Forgotten Books publishes hundreds of thousands of rare and classic books. Find more at www.forgottenbooks.com This book is a reproduction of an important historical work. Forgotten Books uses state-of-the-art technology to digitally reconstruct the work, preserving the original format whilst repairing imperfections present in the aged copy. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in our edition. We do, however, repair the vast majority of imperfections successfully; any imperfections that remain are intentionally left to preserve the state of such historical works.
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality
DOWNLOAD
Author : Richard M. Frankel
language : en
Publisher:
Release Date : 2002
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality written by Richard M. Frankel and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Auditing categories.
We examine the association between the provision of non-audit services and earnings quality. Because of concerns regarding the effect of non-audit services on financial reporting credibility, the Securities and Exchange Commission recently issued revised auditor independence rules requiring firms to disclose in their annual proxy statement the amount of fees paid to auditors for audit and non-audit services. Using data collected from proxy statements filed between February 5, 2001 and June 15, 2001, we present evidence that firms purchasing more non-audit services from their auditor are more likely to just meet or beat analysts' forecasts and to report larger absolute discretionary accruals. However, the purchase of non-audit services is not associated with meeting other earnings benchmarks. We also find that the unexpected component of the non-audit to total fee ratio is negatively associated with stock returns on the filing date. These results are consistent with arguments that the provision of non-audit services strengthens an auditor's economic bond with the client and that investors price this effect. Keywords: Auditor independence; Auditor fees; Earnings management; Discretionary accruals. JEL Classification: G12, M41, M43, M49, L84.
The Economics Of Audit Quality
DOWNLOAD
Author : Benito Arrunada
language : en
Publisher: Springer Science & Business Media
Release Date : 2013-11-11
The Economics Of Audit Quality written by Benito Arrunada and has been published by Springer Science & Business Media this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013-11-11 with Business & Economics categories.
This book focuses on market mechanisms which protect quality in the provision of audit services. The role of public regulation is thus situated in the context defmed by the presence of these safeguard mechanisms. The book aims to contribute to a better understanding of these market mechanisms, which helps in defining the con tent of rules and the function of regulatory bodies in facilitating and strengthening the protective operation of the market. An analysis at a more general level is provided in the three chapters making up Part 1. In the four chapters of Part 2, on the other hand, this analysis is applied to a particular problem to determine how those non-audit services often provided by auditors to their audit clients should be regulated. Finally, Chapter 8 contains a summary of the analysis and conclusions of the work. The conclusion with regard to non-audit services is that their provision generates beneficial effects in terms of costs, technical competence, professional judgment and competition and, moreover, need not prejudice auditor independence or the quality of these services. This as sessment leads, in the normative sphere, to recommending a legislative policy aimed at facilitating the development and use of safeguards provided by the free action of market forces. Regulation should thus aim to enable the parties-audit firms, self-regulatory bodies and audit clients-to discover through competitive market interaction both the most efficient mix of services and the corresponding quality safeguards, adjusting for the costs and benefits of each possibility.
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality
DOWNLOAD
Author : Frankel Richard M
language : en
Publisher: Legare Street Press
Release Date : 2023-07-18
The Relation Between Auditors Fees For Non Audit Services And Earnings Quality written by Frankel Richard M and has been published by Legare Street Press this book supported file pdf, txt, epub, kindle and other format this book has been release on 2023-07-18 with categories.
This groundbreaking study explores the relationship between auditors' fees for non-audit services and the quality of earnings reported by companies. Using data from a large sample of publicly traded firms, the authors show that there is a strong correlation between the two variables, and suggest that this could be a cause for concern for investors and regulators. The authors also provide recommendations for improving the transparency and reliability of financial reporting. This book is essential reading for anyone interested in the intersection of accounting, auditing, and corporate governance. This work has been selected by scholars as being culturally important, and is part of the knowledge base of civilization as we know it. This work is in the "public domain in the United States of America, and possibly other nations. Within the United States, you may freely copy and distribute this work, as no entity (individual or corporate) has a copyright on the body of the work. Scholars believe, and we concur, that this work is important enough to be preserved, reproduced, and made generally available to the public. We appreciate your support of the preservation process, and thank you for being an important part of keeping this knowledge alive and relevant.
Audit Fees Non Audit Services And Auditor Client Economic Bonding
DOWNLOAD
Author : Jeffrey Coulton
language : en
Publisher:
Release Date : 2007
Audit Fees Non Audit Services And Auditor Client Economic Bonding written by Jeffrey Coulton and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2007 with categories.
We investigate whether auditor independence is compromised by either the mix of audit and non audit services (NAS), or simply unusually large NAS or audit fees. The results help reconcile apparently conflicting evidence in prior studies linking NAS and indicators of earnings management, as well as providing new insights on the relation between the incentive structures faced by auditors and variation in audit quality. Using the unexpected accrual component of earnings as a proxy for the effect of impaired auditor independence, we initially find that client firms purchasing an unexpectedly large NAS fee mix (i.e., relative to audit fees) display some evidence of aggressive accounting. However, when we explicitly allow for the possibly endogenous nature of unexpected accruals and unexpected NAS, this result no longer holds. In contrast, similar evidence of a positive relation between the magnitude of unexpectedly large audit fees and positive unexpected accruals still occurs (albeit more weakly) after explicitly allowing for possible endogeneity. A significant positive association between unexpected total fees (audit plus NAS) and the magnitude of positive unexpected accruals is even more robust. However, further tests shows that these quot;resultquot; are confined to clients of Non-Big 6 auditors. We therefore conclude that for large audit firms, the incentive to protect larger than expected fees is outweighed by the importance of their reputation for providing high quality audits relative to smaller audit firms. The results also highlight how sensitive conclusions about possible quot;NAS effectsquot; are to the choice of proxy for economic bond as well as the precise experimental design.
Restricting Non Audit Services In Europe The Potential Lack Of Impact Of A Blacklist And A Fee Cap On Auditor Independence And Audit Quality
DOWNLOAD
Author : Nicole V.S. Ratzinger-Sakel
language : en
Publisher:
Release Date : 2015
Restricting Non Audit Services In Europe The Potential Lack Of Impact Of A Blacklist And A Fee Cap On Auditor Independence And Audit Quality written by Nicole V.S. Ratzinger-Sakel and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015 with categories.
The European audit reform aims to stabilize financial markets by enhancing trust in the statutory audit. To strengthen auditor independence and to increase audit quality the provision of non-audit services to audit clients is further restricted. The supranational introduction of a blacklist, including prohibited non-audit services, and of a cap on the volume of non-audit fees is a novelty on the European level. The purpose of this paper is threefold. First, we analyze these measures in light of both current national restrictions of non-audit services and auditor fee disclosure requirements in France, Germany and the United Kingdom. Second, we assess the potential impact of the cap on the volume of non-audit services by providing descriptive evidence on current fee levels in these three countries. Third, we critically assess the impact of the audit reform regarding non-audit services in light of audit research by analyzing the state-of-the-art. On this basis, we doubt whether the European reform of auditor-provided non-audit services is effective and efficient. The main goal of enhancing perceived auditor independence and, thus, public trust in audited financial statements of public-interest entities may be hardly achieved and the blacklist might present a tradeoff between auditor independence and audit quality.
The Effects Of Joint Provision And Disclosure Of Non Audit Services On Audit Committee Members Decisions And Investors Preferences
DOWNLOAD
Author : Lisa Milici Gaynor
language : en
Publisher:
Release Date : 2006
The Effects Of Joint Provision And Disclosure Of Non Audit Services On Audit Committee Members Decisions And Investors Preferences written by Lisa Milici Gaynor and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006 with categories.
Recent corporate governance reforms that require audit committees to pre-approve audit and non-audit services increase audit committees' accountability to third parties for actual auditor independence and audit quality. Other SEC reforms mandate the disclosure of fees for auditor-provided services and are aimed at influencing investors' perceptions of auditor independence. These fee disclosures also reveal audit committees' pre-approval decisions, enhancing public accountability. Thus, audit committees may be less willing to hire auditors for non-audit services to avoid fee disclosures even when joint provision improves audit quality. One hundred experienced corporate directors, responding as audit committee members or investors, participated in an experiment in which we manipulated the effect of the auditor's provision of non-audit services on audit quality and the fee disclosure requirement. We find that audit committee members are more likely to recommend joint provision if audit quality improves, consistent with investors' preferences. However, unlike investors, committee members are more reluctant to recommend joint provision when public disclosures are required, even at the expense of audit quality. These findings offer evidence about an indirect effect of recent reforms.
Indians Of Western Illinois And Southern Wisconsin
DOWNLOAD
Author :
language : en
Publisher:
Release Date : 1974
Indians Of Western Illinois And Southern Wisconsin written by and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 1974 with categories.
Non Audit Services Incentives And Audit Quality
DOWNLOAD
Author : Lucas Mahieux
language : en
Publisher:
Release Date : 2019
Non Audit Services Incentives And Audit Quality written by Lucas Mahieux and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2019 with categories.
I develop a framework that provides new insights into the consequences of the provision of non-audit services (NAS) by audit firms to audit clients. The investors of a client firm may optimally let the auditor provide NAS because of an incentive effect. Indeed, the possibility of providing NAS contingent on detecting financial misstatements increases the auditor's incentives to exert audit effort. However, the provision of NAS also reduces auditor independence, which may decrease audit quality and in turn render the provision of NAS by auditors undesirable. Thus, my analysis uncovers an interesting tradeoff for regulators between the positive incentive effect and the decrease in auditor independence. Removing the current restriction on contingent audit fees may offset the ex post decrease in audit quality while preserving the ex ante incentives. My analysis also generates a number of testable empirical predictions.