Management turnover following auditor resignations

• 成果类型: Article
• 署名作者: Menon, Krishnagopal; Williams, David D.
• 署名单位: Boston University; University System of Ohio; Ohio State University
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1506/car.25.2.10
• 发表日期: 2008
• 页码: 567-+
• 关键词: CEO TURNOVER; LITIGATION; issues; RESTATEMENTS; replacement; succession; DIRECTORS; FAILURE

摘要

We investigate chief executive officer (CEO) and chief financial officer (CFO) changes in firms that experience an auditor resignation. We argue that boards of directors have incentives to replace these managers following an auditor resignation both to improve financial reporting performance and to restore reporting credibility. We use two control samples, one matched on industry and size and the other comprising firms that experienced client-initiated auditor changes. We observe higher turnover in both CEO and CFO positions following auditor resignations than in either of the two control samples. The incidence in CEO and CFO turnover increases for firms filing auditor resignation-related reportable events.