Earnings quality: Some evidence on the role of auditor tenure and auditors' industry expertise

• 成果类型: Article
• 署名作者: Gul, Ferdinand A.; Fung, Simon Yu Kit; Jaggi, Bikki
• 署名单位: Hong Kong Polytechnic University; Rutgers University System; Rutgers University New Brunswick
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2009.03.001
• 发表日期: 2009
• 关键词: bonus schemes; firm tenure; specialization; performance; accruals; management; MARKET; differentiation; INDEPENDENCE; Reputations

摘要

Prior Studies suggest that auditors with short tenure are associated with lower earnings quality because of the lack of client-specific knowledge and/or low balling. In this study, we examine whether industry specialization of auditors and low balling affect the association between auditor tenure and earnings quality. We find that the association between shorter auditor tenure and lower earnings quality is weaker for firms audited by industry specialists compared to non-specialists. In addition, we do not find results consistent with the low bailing explanation. (C) 2009 Elsevier B.V. All rights reserved.