Download or read book Audit Firms Network Structure and Audit Quality written by Maysam Ayoub and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Does International Accounting Network Membership Affect Audit Fees and Audit Quality Evidence from Chinese Small Audit Firms written by Juan Mao and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Regulators suggest that small audit firms should join international accounting networks to reduce their resource constraints in serving large clients and providing high-quality service. Bills, Cunningham, and Myers (BCM, 2016) investigate the issue in the U.S. and find that audit fees and quality are both higher for members of international accounting networks (i.e., member audit firms). We investigate the effects of network membership on audit fees and quality in China, a weak institutional environment. Using data of Chinese listed companies audited by non-Big N audit firms from 2001 to 2010, we find that member audit firms charge 3.9% higher fees than nonmember audit firms, much lower than 30% fee premiums charged by U.S. member audit firms (BCM, 2016). We fail to find consistent evidence that audit quality is higher for member audit firms. Overall, our results demonstrate that China's weak institutional environment may overwhelm the quality control brought by international accounting networks and it may weaken or even offset the benefits of audit firms' participation in these networks, resulting in smaller or even no effects of membership on audit fees and quality.
Download or read book Small Audit Firm Membership in Associations Networks and Alliances written by Kenneth L. Bills and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: In this study, we examine the benefits of membership in an accounting firm association, network, or alliance (collectively referred to as 'an association'). Associations provide member accounting firms with numerous benefits, including access to the expertise of professionals from other independent member firms, joint conferences and technical trainings, assistance in dealing with staffing and geographic limitations, and the ability to use the association name in marketing materials. We expect these benefits to result in higher quality audits and higher audit fees (or audit fee premiums). Using hand-collected data on association membership, we find that association member firms conduct higher quality audits than nonmember firms, where audit quality is proxied for by fewer Public Company Accounting Oversight Board inspection deficiencies and fewer financial statement misstatements, as well as less extreme absolute discretionary accruals and lower positive discretionary accruals. We also find that audit fees are higher for clients of member firms than for clients of nonmember firms, suggesting that clients are willing to pay an audit fee premium to engage association member audit firms. Finally, we find that member firm audits are of similar quality to a size-matched sample of Big 4 audits, but member firm clients pay lower fee premiums than do Big 4 clients. Our inferences are robust to the use of company size-matched control samples, audit firm size-matched control samples, propensity score matching, two-stage least squares regression, and to analyses that consider changes in association membership. Our findings should be of interest to regulators because they suggest that association membership assists small audit firms in overcoming barriers to auditing larger audit clients. In addition, our findings should be informative to audit committees when making auditor selection decisions, and to investors and accounting researchers interested in the relation between audit firm type and audit quality.
Download or read book The Routledge Companion to Auditing written by David Hay and published by Routledge. This book was released on 2014-09-15 with total page 387 pages. Available in PDF, EPUB and Kindle. Book excerpt: Auditing has been a subject of some controversy, and there have been repeated attempts at reforming its practice globally. This comprehensive companion surveys the state of the discipline, including emerging and cutting-edge trends. It covers the most important and controversial issues, including auditing ethics, auditor independence, social and environmental accounting as well as the future of the field. This handbook is vital reading for legislators, regulators, professionals, commentators, students and researchers involved with auditing and accounting. The collection will also prove an ideal starting place for researchers from other fields looking to break into this vital subject.
Download or read book Auditing Trust and Governance written by Reiner Quick and published by Routledge. This book was released on 2007-10-17 with total page 302 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this important new book, the European Auditing Research Network gives a timely appraisal of the regulatory environment for financial accounting and auditing in the wake of a series of high profile scandals involving major corporations.
Download or read book The Benefits and Costs of Group Affiliation written by Stijn Claessens and published by . This book was released on 2002 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates the benefits and associated agency costs of using internal capital markets through affiliating with groups using data of two thousand firms from nine East Asian economies between 1994-96. We find that mature and slow-growing firms with ownership structures more likely to create agency problems gain more from group affiliation, while young and high-growth firms more likely lose. Agency problems are important explanatory factors of firm value in economies outside Japan, but less so in Japan. Consistent with the literature, financially-constrained firms benefit from group affiliation. Our results are robust to different time periods and estimation techniques.
Download or read book Count Down written by Jim Peterson and published by Emerald Group Publishing. This book was released on 2017-07-03 with total page 352 pages. Available in PDF, EPUB and Kindle. Book excerpt: Enron killed Arthur Andersen in 2002, leaving only Deloitte, EY, KPMG and PwC. Now the Big Four, with a total revenue of $127 billion, face major threats that need immediate attention. Count Down looks at today’s model and proposes a new Big Audit, fit to serve the capital markets of the 21st century.
Download or read book Audit Quality written by Jonas Tritschler and published by Springer Science & Business Media. This book was released on 2013-10-31 with total page 251 pages. Available in PDF, EPUB and Kindle. Book excerpt: Arising from the author’s experience as a practicing CPA, this book is quite different from other research in this field, as it confronts the subject of audit quality from a pragmatic perspective. The first goal of Jonas Tritschler is to develop an audit quality metric on national audit firm level. Financial reporting errors, as detected by the German enforcement institutions during examinations, which subsequently are published in the German Federal Gazette by the involved companies, are the data basis for this measurement. Using the developed audit quality metric, the second goal of this study is to analyze audit quality differences of selected audit firms by comparing their deployed audit input factors such as employee’s competence (ratio of certified professionals to total audit staff), experience of employees (average tenure of employees in years) and client-specific experience (client fluctuation rate). Results indicate a correlation between audit quality according to the developed metric and the operationalized audit input factors mentioned above.
Download or read book Auditing Teams written by Mara Cameran and published by Taylor & Francis. This book was released on 2017-03-31 with total page 133 pages. Available in PDF, EPUB and Kindle. Book excerpt: The recent audit failures which have rocked financial markets worldwide have accentuated the need for a better understanding of the link between risk, control and audit quality; as well as emphasising the need to open the "black box" of the ways auditing firms actually function. Reflecting these imperatives, Auditing Teams unravels the organizational and management issues in audit firms that are key to achieving effectiveness in service provision. Specifically, this key research reflects upon the relevance and dynamics of auditing teams and their impact on auditing quality, and specifically responding to the recent claim from regulators which highlights auditing team characteristics as the source of wide variations in quality. By leveraging different perspectives – auditing, management accounting, organization and psychology – to investigate auditing teams and basing on evidence collected from the professional world, this book will provide a unique insight into the role of auditing teams on audit quality. It will be of great interest to scholars and advanced students in auditing, as well as to practitioners and regulators in the field.
Download or read book International Audit Firms as Strategic Networks The Evolution of Global Professional Service Firms written by Hansrudi Lenz and published by . This book was released on 2016 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: The evolution of large international audit firms was driven by client needs and legal regulations specific for the audit industry. The organizational structure of these professional service firms can be characterized as a specific form of a strategic network. The national member firms have to adapt to their different legal, cultural, and economic national environment. In particular, the legal rules in the audit sector establish barriers of entry for foreign competitors and prevent more common forms of market entry, e.g. the acquisition of another audit firm or the establishment of a subsidiary in a foreign country. Networks of audit firms are a prime example of hybrid governance structures between markets and hierarchies and are organized by contractual relationships between legal and economically autonomous partnership entities from different countries. These networks are controlled by a committee structure. Strategic decisions are made by one or more lead firms.This article describes the governance structure of international audit firm networks. Furthermore, we analyse how coordination and incentive problems, e.g. hold-up and moral hazard situations are dealt with in these network structures. Exclusive rights, referral work, brand names, network-specific investments, and profit pooling are means to ensure that network members cooperate.
Download or read book Economics and Management of Networks written by Gérard Cliquet and published by Springer Science & Business Media. This book was released on 2007-03-20 with total page 460 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous research on the institutional structure of franchising networks (Bri- ley et al. 1991; Lutz 1995; Shane 1998; Lafontaine and Shaw 1999, 2005; - fuso 2002; Penard et al. 2003a,b) does not explain the governance structure of the franchising firm as an institutional entity that consists of two interrelated parts: Residual decision rights and ownership rights. The latter includes not only residual income rights of franchised outlets but also residual income rights of franchisor-owned outlets. Previous studies primarily examines the incentive, signalling and screening effects of fees, royalties and other contractual pro- sions from the point of view of organizational economics (see Dnes 1996 for a review) without taking into account the interactions between residual decision and residual income rights as interrelated parts of the governance structure. This paper fills this gap in the literature. According to the property rights view, de- sion rights should be allocated according to the distribution of intangible kno- edge assets between the franchisor and franchisee and ownership rights should be assigned according to the residual decision rights. Since ownership rights are diluted in franchising networks, the dilution of residual income rights of fr- chised outlets is compensated by residual income rights of company-owned o- lets. Under a dual ownership structure, company-owned outlets compensate the disincentive effect of low royalties for the franchisor, and low royalties strengthen the investment incentives for the franchisee.
Download or read book Integrated Reporting and Audit Quality written by Chiara Demartini and published by Springer. This book was released on 2017-04-13 with total page 136 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book analyzes the relationship between integrated reporting and audit quality within the European context, presenting empirical evidence and drawing on a broad review of the available literature in order to evaluate the ability of integrated reporting to enhance audit risk assessment. Dedicated sections first elucidate the concepts of integrated reporting and audit quality. The main integrated reporting frameworks are compared, the role of integrated reporting within a firm’s disclosure is examined, and all aspects of audit risk are discussed. The key question of the impacts of integrated reporting on the components of audit risk is then addressed in detail, with reference to empirical findings, their practical implications, and their limitations. The concluding section explores the future of corporate reporting and the development of the next integrated reporting framework and summarizes the insights that the analysis in the book offers into the relationship between integrated reporting and audit quality in the European setting.
Download or read book Big 4 Global Networks written by M. Paulina Kassawat and published by . This book was released on 2015 with total page 73 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Big 4 global networks (Deloitte, Ernst & Young [E&Y], KPMG, and PricewaterhouseCoopers [PwC]) market themselves as providers of worldwide seamless services and consistent audit quality through their members. Under the current environment in which these auditors operate, there are three types of global network members: inspected non-U.S. affiliates (inspected affiliates, hereafter), non-inspected non-U.S. affiliates (non-inspected affiliates, hereafter), and inspected U.S. offices (U.S. offices, hereafter). The recent suspension of the China-based Big 4 affiliates from auditing U.S.-listed companies calls into question whether these global networks can deliver the same level of audit quality across all their members and whether those located in jurisdictions denying access to the Public Company Accounting Oversight Board (PCAOB or Board, hereafter) to conduct inspections may benefit from such inspections. This study examines the effect of being an affiliate and the effect of PCAOB inspections on perceived audit quality. I use earnings response coefficients (ERCs) as a proxy for perceived audit quality. This study finds no evidence that affiliates have lower perceived audit quality than that of the U.S. offices. Additionally, I find no evidence that PCAOB inspected members have higher perceived audit quality than that of the non-inspected members. These results are robust to different measures of unexpected returns, unexpected earnings, and to using alternative approaches to determine when an auditor has been inspected. These findings are relevant because they provide evidence that the Big 4 global networks are delivering on their promise of providing similar audit quality through all their members. Additionally, the lack of results of the effect of PCAOB inspections on audit quality is inconsistent with accountability theory but may suggest that the internal review systems and other internally developed mechanisms by the global networks are as effective as external accountability measures.
Download or read book A Field Study on Small Accounting Firm Membership in Associations and Networks written by Kenneth L. Bills and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Small accounting firms represent important participants in the audit market, yet details of how they operate and develop competencies remain unexplored. Small firms often join forces through accounting associations and networks (“AANs”), which may help them overcome significant challenges commonly faced by smaller firms. We interview 37 partners from 18 firms representing nine AANs to examine how small firms leverage their AAN membership and to understand the related implications for audit quality. Our findings indicate that small firms acquire needed resources and enhance their market legitimacy through AAN membership; however, the nature and extent to which they do so varies by AAN type. Importantly, we also find that the majority of respondents perceive AAN resources, especially access to expertise, as critical to their firms' audit quality. Our research, informed by a theoretical lens based on resource dependence and legitimacy, enriches existing auditing literature, provides a new perspective for member firms and regulators, and responds to recent calls to understand factors affecting accounting firms' competencies.
Download or read book Auditing Teams written by Mara Cameran and published by Routledge. This book was released on 2017-03-31 with total page 166 pages. Available in PDF, EPUB and Kindle. Book excerpt: The recent audit failures which have rocked financial markets worldwide have accentuated the need for a better understanding of the link between risk, control and audit quality; as well as emphasising the need to open the "black box" of the ways auditing firms actually function. Reflecting these imperatives, Auditing Teams unravels the organizational and management issues in audit firms that are key to achieving effectiveness in service provision. Specifically, this key research reflects upon the relevance and dynamics of auditing teams and their impact on auditing quality, and specifically responding to the recent claim from regulators which highlights auditing team characteristics as the source of wide variations in quality. By leveraging different perspectives – auditing, management accounting, organization and psychology – to investigate auditing teams and basing on evidence collected from the professional world, this book will provide a unique insight into the role of auditing teams on audit quality. It will be of great interest to scholars and advanced students in auditing, as well as to practitioners and regulators in the field.
Download or read book External Auditing and Quality written by Iffet Kesimli and published by Springer. This book was released on 2018-07-17 with total page 327 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book focuses on factors impacting audit quality, and solutions to these problems. In addition to elaborating on legislation in the European Union and United States, the book also provides a thorough outlook of Turkish audit market from the point of view of auditing firms and their clients. Many cases and samples are provided to assist practitioners to successfully re-engineer organizational structures in accordance with fresh regulations and expectations of the market. This book serves as a helpful resource for auditing firms, auditors, regulating authorities, as well as post-graduate students of audit sector.
Download or read book A Comparative Study of Audit Quality Among the Big Eight Accounting Firms written by Joseph Vincent Carcello and published by . This book was released on 1990 with total page 286 pages. Available in PDF, EPUB and Kindle. Book excerpt:
