Uninvolved: Effects of Misstatement-Independent Auditor Oversight
Uninvolved: Effects of Misstatement-Independent Auditor Oversight
dc.contributor.author | Gomez, Pedro | |
dc.date.accessioned | 2021-11-12T18:53:22Z | |
dc.date.available | 2021-11-12T18:53:22Z | |
dc.date.issued | 2021 | |
dc.description.abstract | Researchers in prior studies assume the current auditor is responsible for misstated financials or attempt to perform filtering to assign responsibility. However, for a minimally filtered sample of restatements within Audit Analytics, 20 percent of the restatements annually correspond to cases where the auditor engaged at the time of a restatement announcement was not engaged during the misstatement period. I refer to these observations as uninvolved. Using a similar model from prior literature, I find that companies with involved audit firms are negatively associated with the abnormal return around the restatement announcement. Following the restatement announcement, companies with uninvolved audit firms have a lower likelihood of experiencing audit turnover, and uninvolved auditor departures are characterized by a positive abnormal market reaction around the departure date. These findings suggest that involvement is an informative dimension to the market and is associated with different audit outcomes. | |
dc.identifier.uri | http://hdl.handle.net/10125/77050 | |
dc.subject | audit quality | |
dc.subject | audit firm reputation | |
dc.subject | restatements | |
dc.subject | market reactions to misstatements | |
dc.subject | audit firm turnover | |
dc.subject | audit firm turnover market reactions | |
dc.title | Uninvolved: Effects of Misstatement-Independent Auditor Oversight | |
dc.type.dcmi | Text |
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