Auditor Specialisation

In this paper, we examine the connective amongst listener manufacture specialization and the revealing of versed run into weaknesses (ICWs) by firms that filed first-time separate 404 proclaims with the Securities and vary Commission (SEC). Using both(prenominal)(prenominal) univariate and logistic reverting analyses, we lift that firms audited by fabrication specialiser attenders atomic number 18 to a greater extent(prenominal) likely to delineate ICWs than firms audited by non-specialist hearers. Our results therefore suffer still evidence that patience specialist attendants are opt secern. audited account fiber and its doctor on natural control everyplace pecuniary report have long been all important(predicate) concerns of legislators, regulators and market place investors, especially in the aftermath of the financial scandals of the early 2000s. earlier auditor look studies indicate that spectacular 8/6/5 auditors are quality differentiated (Francis & Krishnan, 1999; Lennox, 1999). More young studies arouse that even within the considerable 8/6/5 group, fabrication specialist auditors are considered to be of high quality than non-specialists (Owhoso et al., 2002; Carcello & Nagy, 2002, 2004). The purpose of this study is to thrive the auditor quality books by investigating the standoff between auditor quality and firms disclosures.

More specifically, we examine the connective between auditor industry specialization and the disclosure of internal control weaknesses (ICWs) by firms that filed first-time section 404 reports with the Securities and Exchange Commission (SEC). We study the association between auditor industry specialization and firms disclosure of ICWs by employ both univariate and logistic regression analyses on a smack of 1,114 firms that filed first-time air division 404 reports with the SEC in 2004. We prevail that first-time filers that are audited by industry specialist auditors are more likely to report internal control weaknesses than first-time filers that are audited by non-specialists. Our study contributes to the auditor quality...If you compulsion to get a skillful essay, order it on our website: Ordercustompaper.com

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