Per citar aquest document: http://ddd.uab.cat/record/127812
Incumbent audit firm-provided tax services and the clients with low financial reporting quality
Myllymäki, Emma-Riikka
Universitat Autònoma de Barcelona. Departament d'Empresa

Publicació: Universitat Autònoma de Barcelona. Departament d'Economia de l'Empresa 2014
Descripció: 46 p.
Col·lecció: Document de treball (Universitat Autònoma de Barcelona. Departament d'Economia de l'Empresa) ; 14/4
Resum: This study investigates whether incumbent audit firm-provided tax services enhance or impair the likelihood of acknowledging client companies' low financial reporting quality. In particular, we examine the association between tax-related fees and the likelihood of timely restatements, and internal control weakness disclosures among a sample of US companies that all have misstatements in financial information. The empirical findings indicate that companies paying higher tax-related fees are less likely to disclose SOX 404 internal control weakness disclosures, implying that underlying control problems are unacknowledged when incumbent audit firm provided tax-related fees are higher. However, the findings suggest that just providing both audit and tax-related services does not have an impact on audit quality per se, but rather it is the magnitude of the tax-related fees in particular that counts. We also find some evidence suggesting that companies paying higher tax-related fees have higher likelihood of restatement lags, whereas companies paying smaller tax-related fees to their audit firm restate financial statements in a timelier manner. Overall, the findings suggest that audit scrutiny of client companies with low quality financial reporting is weaker when the magnitude of tax-related fees is higher.
Drets: L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons: Creative Commons
Llengua: Anglès.
Document: workingPaper
Matèria: Auditoria ; Impostos ; Informació financera

Adreça alternativa: http://hdl.handle.net/2072/243655


46 p, 231.4 KB

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