Empirical studies of earnings management, audit pricing, and audit reporting provide extensive evidence that the Big Five public accounting firms are associated with higher quality financial statements (Francis 2004). Nevertheless, the recent high-profile financial reporting failures that roiled the U.S. capital markets cast doubt on whether this proposition remains valid. Indeed, many commenta...

This study investigates the audit firm’s decision to protect its partners’ personal assets by becoming a limited liability partnership (LLP). We find that the likelihood of an audit firm switching from unlimited to limited liability is increasing in its size and exposure to litigation risk. We find no evidence that audit firms supply lower audit quality, lose market share, or charge lower audit...

PURPOSE The purpose of this article is to clarify the distinction between research and audit, and propose appropriate regulatory arrangements for audit and related activities. DESIGN/METHODOLOGY/APPROACH The methods used were literature reviews and conceptual analysis. FINDINGS Research and audit overlap in various ways, but differ in terms of their purposes and the risks likely to be encou...

Audit fee studies often find large (Big 5) audit firms earn significantly higher fees than small (non-Big 5) firms, but they treat auditor choice as exogenous. In contrast, this paper takes into account that companies are not randomly assigned to audit firms. We find the effects of auditor selection bias on audit fees are statistically and economically significant. Consistent with the predictio...

Abstract: This research investigates the role of audit quality as moderation on association between opinions and accrual earnings. The sample used in this study is Indonesian companies listed Stock Exchange (IDX) during 2016 – 2020. uses Generalized Least Squares (GLS) regression models to process data. results show that are positively associated with earnings management. When examined individu...