Earnings quality: Some evidence on the role of auditor tenure and auditors’ industry expertise

Gul, Ferdinand A.; Fung, Simon; Jaggi, Bikki

doi:10.1016/j.jacceco.2009.03.001

Cited by 592 publications

(525 citation statements)

References 63 publications

(115 reference statements)

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“…OCF was included to control for the differences of performance across firms within different industries and economic activity on earnings management. The studies by Gul et al (2009);and Dechow et al (1995) find that firms with a high operational cash flow are less likely to engage to income-incresing earnings management because they are already performing well. In line with the previous studies, we expect that firms with a high cash flow performance are less likely to engage in incomeincreasing earnings management.…”

Section: Methodsmentioning

confidence: 99%

“…Gul et al (2009) argue that not only do females demonstrate a greater risk aversion and ethical behaviour, but they are also better at obtaining voluntary information which may reduce information asymmetry between female directors and managers. Women are more cautious and less aggressive, than men in a variety of decision-making contexts (Byrnes et al 1999), and are less likely to take risks particularly in the financial decision environment (Powell and Ansic 1997).…”

Section: Female Directors and Earnings Management -The Key Questionsmentioning

confidence: 99%

“…There is therefore a greater likelihood of a restrained approach to earnings management (Gul et al 2009). In a similar vein, Krishnan and Parsons (2008) found that the quality of earnings management is higher for firms with more female directors, and argued that women are likely to be more ethical in their judgement and behaviour than men.…”

Section: Female Directors and Earnings Management -The Key Questionsmentioning

confidence: 99%

See 2 more Smart Citations

Female directors and earnings management: Evidence from UK companies

Arun

Almahrog

Ali

2015

International Review of Financial Analysis

291

227

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Section: Methodsmentioning

confidence: 99%

Section: Female Directors and Earnings Management -The Key Questionsmentioning

confidence: 99%

Section: Female Directors and Earnings Management -The Key Questionsmentioning

confidence: 99%

See 1 more Smart Citation

Female directors and earnings management: Evidence from UK companies

Arun

Almahrog

Ali

2015

International Review of Financial Analysis

291

227

View full text Add to dashboard Cite

“…While some empirical studies have reported the abilities of audit quality to significantly constrain earnings management [6][7][8] others have reported otherwise.…”

Section: Review Of Empirical Studiesmentioning

confidence: 99%

Audit Quality and Earnings Management among Nigerian Listed Deposit Money Banks

Olabisi¹,

To²,

To³

2017

Int J Account Res

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IntroductionIn recent times, the call for reliable financial reporting has gained prominence in Nigeria and global economy at large. The capability or incapability of banks to effectively fulfill intermediate mandate has been the crux of many financial crises. Mediating between the surplus and deficit units within the economy expedites distribution of national savings, thereby improving investments and national output. In 2005, the Central Bank of Nigeria mandated every Nigerian bank to increase capital base from 2 billion naira to 25 Billion Naira in order to enhance competitiveness in the international market. Noteworthy capital market expectations were raised and banks were under pressure to achieve survival and generate higher returns to shareholders. This pressure from the Central Bank of Nigeria has occasioned banks falsifying accounts, inflating earnings and capital. The need for reliable reports has led to statutory audit that provides independent authentication of financial statements prepared by banks' directors.Auditors are instructed to report financial misdemeanors in company's accounts to increase transparency and accountability through fraud detection. Earnings are made up of accruals and cash items and accruals are basically controlled by company's stewards. Management can bloat performance of company and future earnings predictions through manipulation of accruals resulting in earnings management. Financial reports contain accounting information which different users use to appraise firm's performance. Investors use cash flow statement to make investment decisions thereby creating room for highly motivated and intelligent management teams to manipulate the real economic operations to influence the true picture of a company's cash flow from operations. Since accrual accounting measures the performance of company by recognizing economic events irrespective of when transactions occur. Earnings management is therefore, discovered by conducting tests on the components of accrual assumed to be at the managerial discretionary accruals thereby revealing information asymmetries. Accounting scandals experienced in the last few years have affected the regulators' trust of financial statements. This scandal and its consequent results are reasons for drawing attention to quality and reliability of financial statements in the banking sector. Therefore, the absence of investors' confidence in the reported earnings influence the financial market because investors are major players in ensuring availability of capital to support the economic system. Given the above state, this study seeks to assess the effect of audit quality on earnings management in Nigerian listed deposit money banks. The broad objective of this study is to identify relationship between audit quality and earnings management of Nigerian listed money deposit banks while to assess relationship among joint audit, auditor specialization, auditor independence and audit tenure on the earnings management in the listed deposit money banks in Nigeria wo...

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“…They argue that The existence of female directors on top management level reduce information asymmetry between women directors and managers through obtaining voluntary information as well as better to demonstrate greater ethical behaviour and risk aversion (Francis, Hasan, Park, & Wu, 2009;Gul, Yu, Fung, & Jaggi, 2009). Byrnes, Miller, and Schafer (1999) provide evidence that women are less likely to take risks, particularly in the financial decision environment.…”

Section: Hypotheses Developmentmentioning

confidence: 99%

Women in Board of Directors and Real Earnings Management: Accretive Share Buyback in Malaysia

Alquhaif¹,

Latif²,

Chandren³

2017

AJFA

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Gender diversity of boards and reporting of earnings are two most debated issues in the Asian Journal of Finance & Accounting ISSN 1946-052X 2017 ajfa.macrothink.org 49 corporate world. In this context, the paper explores how the presence of women directors on the corporate board influence real earnings management through accretive buyback programs. Using a sample of 601 firms' observations that engage in accretive share buyback from 2010-2015, the findings reveal that existence of women directors on the board is associated with less engagement in accretive share buyback activities. We further find that firms with a higher number of independent directors are less likely to practice real earnings management through accretive buyback programs. Our paper contributes to the debate on gender diversity on boards and its influence on the utilisation of accretive buyback programs as a tool to real earnings management.

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Earnings quality: Some evidence on the role of auditor tenure and auditors’ industry expertise

Cited by 592 publications

References 63 publications

Female directors and earnings management: Evidence from UK companies

Female directors and earnings management: Evidence from UK companies

Audit Quality and Earnings Management among Nigerian Listed Deposit Money Banks

Women in Board of Directors and Real Earnings Management: Accretive Share Buyback in Malaysia

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