Corporate governance and audit process

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 lik...

Full description

Saved in:
Bibliographic Details
Main Author: Lim, Chee Yeow
Other Authors: Nanyang Business School
Format: Research Report
Language:English
Published: 2015
Subjects:
Online Access:http://hdl.handle.net/10356/62005
Tags: Add Tag
No Tags, Be the first to tag this record!
Institution: Nanyang Technological University
Language: English
id sg-ntu-dr.10356-62005
record_format dspace
spelling sg-ntu-dr.10356-620052023-05-19T07:31:16Z Corporate governance and audit process Lim, Chee Yeow Nanyang Business School DRNTU::Business::Finance::Corporate governance 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. 2015-01-05T02:18:43Z 2015-01-05T02:18:43Z 2006 2006 Research Report http://hdl.handle.net/10356/62005 en Nanyang Technological University 60 p. application/pdf
institution Nanyang Technological University
building NTU Library
continent Asia
country Singapore
Singapore
content_provider NTU Library
collection DR-NTU
language English
topic DRNTU::Business::Finance::Corporate governance
spellingShingle DRNTU::Business::Finance::Corporate governance
Lim, Chee Yeow
Corporate governance and audit process
description 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.
author2 Nanyang Business School
author_facet Nanyang Business School
Lim, Chee Yeow
format Research Report
author Lim, Chee Yeow
author_sort Lim, Chee Yeow
title Corporate governance and audit process
title_short Corporate governance and audit process
title_full Corporate governance and audit process
title_fullStr Corporate governance and audit process
title_full_unstemmed Corporate governance and audit process
title_sort corporate governance and audit process
publishDate 2015
url http://hdl.handle.net/10356/62005
_version_ 1772826268617670656