Work

Non-audit services and audit quality --- the effect of Sarbanes-Oxley Act

Year: 2017

Type: article

Abstract: There has been controversy over the restrictions that SOX imposes on non-audit services. Using accounting conservatism as a proxy for earnings quality of financial statements, the paper investigates whether the offerings of non-audit services by auditors impairs earnings quality. And then, to validate the effects of SOX, this paper also explores the association between non-audit services and accounting conservatism before and after SOX enacted. The empirical results show that non-audit services do impair earnings quality before SOX, but yields no conclusive results whether the provision of non-audit services affects earnings quality. This result supports the positive effects of the regulations of SOX in governing the independence of auditors.

Source: Asia Pacific Management Review

DOI: 10.1016/j.apmrv.2017.07.004

Authors: Betty Chu, Yunsheng Hsu

Institutions: National Taiwan University, National Chung Hsing University, National Taipei University

Language: English

Topic: Auditing, Earnings Management, Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,000

OpenAlex ID: W2744162149

FWCI: 11.52

Cites: 31

Cited by: 33

Related to: 10