Auditor Independence, Auditor Specialization and Earnings Management: Further Evidence from Singapore

• المؤلفون الرئيسيون: Rusmin, Rusmin, Van der Zahn, Jean-Luc Wolfgang Mitchell, Tower, Greg, Brown, Alistair
• التنسيق: text
• اللغة: English
• منشور في: Institutional Knowledge at Singapore Management University 2006
• الموضوعات: abnormal accruals; auditor independence; auditor specialisation; Singapore; earnings management; audit value attributes; auditing; Accounting; Business Law, Public Responsibility, and Ethics; Corporate Finance
• الوصول للمادة أونلاين: https://ink.library.smu.edu.sg/soa_research/125; http://dx.doi.org/10.1504/IJAAPE.2006.010300

This study uses data from 298 Singapore publicly listed firms to examine the association between earnings management and two audit value attributes: auditor independence and auditor specialisation. We find firms engaging a specialist auditor had significantly lower levels of abnormal accruals than those using non-specialists. This supports the view industry specialisation better enables an auditor to constrain a client's earnings management. Our findings indicate the lack of a universal association between audit value attributes and earnings management. Results imply recent action of Singapore policymakers to strengthen rules governing audit independence as related to non-audit services may have been premature.