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The Accounting Review
Balancing the Dual Responsibilities of Business Unit Controllers: Field and Survey Evidence
ABSTRACT: We examine how business unit (BU) controllers balance their dual roles of providing information for both local decision-making (local responsibility) and corporate control (functional respon...
ABSTRACT: We examine how business unit (BU) controllers balance their dual roles of providing information for both local decision-making (local responsibility) and corporate control (functional respon...
The Voluntary Adoption of Internationally Recognized Accounting Standards and Firm Internal Performance Evaluation
ABSTRACT: A large body of research is devoted to understanding the causes and consequences of firms' adoption of internationally recognized accounting standards. Thus far, researchers' attention has f...
ABSTRACT: A large body of research is devoted to understanding the causes and consequences of firms' adoption of internationally recognized accounting standards. Thus far, researchers' attention has f...
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Internal Audit Quality and Earnings Management
The Accounting Review 84 (4), 1255 (2009);
doi: 10.2308/accr.2009.84.4.1255
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ABSTRACT: Internal auditors perform work that is relevant to their host entities' financial reporting processes; yet, little research attention has focused on the effects of internal auditing on companies' external financial reporting. Using a unique and previously unavailable data set, we investigate the relation between internal audit function (IAF) quality and earnings management. We measure IAF quality using a composite measure comprising six individual components of IAF quality based on SAS No. 65, which guides external auditors in assessing the quality of an IAF with respect to its role in financial reporting. Earnings management is measured using two separate proxies: (1) abnormal accruals and (2) the propensity to meet or barely beat analysts' earnings forecasts. We find evidence that IAF quality is associated with a moderation in the level of earnings management as measured by both proxies.
©2009 American Accounting Association
| History: | Submitted July 2007; accepted December 2008; published July 2009 |
| Permalink: |
http://link.aip.org/link/ACRVAS/v84/i4/p1255/s1 |
PUBLICATION DATA
0001-4826 (print)
1558-7967 (online)
American Accounting Association
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