Busy auditors, ethical behavior, and discretionary accruals quality in Malaysia


Autoria(s): Lai, Karen M. Y.; Sasmita, Andriyawan; Gul, Ferdinand A.; Foo, Yee Boon; Hutchinson, Marion
Data(s)

20/04/2016

Resumo

The required professional and ethical pronouncements of accountants mean that auditors need to be competent and exercise due care and skill in the performance of their audits. In this study, we examine what happens when auditors take on more clients than they should, thus raising doubts about their ability to maintain competence and audit quality. Using 2803 observations of Malaysian companies from 2010 to 2013, we find that auditors with multiple clients are associated with lower earnings quality, proxied by total accruals and discretionary accruals. Our results demonstrate that associating client firms’ reported discretionary accruals with individual auditors, rather than their firms or offices, is important in determining audit quality. Moreover, we demonstrate that the disclosure of auditors’ signatures on their reports is useful for assessing auditor quality at the individual level, thus contributing to the debate on the usefulness of having auditor identities on reports.

Formato

application/pdf

Identificador

http://eprints.qut.edu.au/95557/

Publicador

Springer Verlag

Relação

http://eprints.qut.edu.au/95557/3/95557.pdf

DOI:10.1007/s10551-016-3152-4

Lai, Karen M. Y., Sasmita, Andriyawan, Gul, Ferdinand A., Foo, Yee Boon, & Hutchinson, Marion (2016) Busy auditors, ethical behavior, and discretionary accruals quality in Malaysia. Journal of Business Ethics. (In Press)

Direitos

Copyright 2016 Springer Science+Business Media Dordrecht

The final publication is available at Springer via http://dx.doi.org/10.1007/s10551-016-3152-4

Fonte

QUT Business School; School of Accountancy

Palavras-Chave #150300 BUSINESS AND MANAGEMENT #multiple audit clients #ethical behavior #discretionary accruals #audit quality
Tipo

Journal Article