Auditor Brand Name, Industry Specialisation, and Earnings Management: Evidence from Taiwanese Companies

International Journal of Accounting, Auditing and Performance Evaluation, Vol. 3(2): 194-219, 2006

Posted: 3 Mar 2017

See all articles by Ken Y. Chen

Ken Y. Chen

National Taiwan University; National Taiwan University

Shan-Ying Wu

Kun Shan University of Technology

Jian Zhou

University of Hawaii at Manoa

Date Written: 2006

Abstract

We investigate the relationship between auditor brand name, industry specialization, and earnings management as measured by discretionary accruals for a sample of listed companies in Taiwan, where the litigation risk against auditors is much less than the risk in the USA. We find that the use of Big 5 auditors is related to less earnings management in Taiwan. We also find that industry specialist auditors are related to less income increasing earnings management, which, to our knowledge, has not been demonstrated by any audit quality and earnings management studies in Taiwan.

Keywords: Auditor Brand Name, Industry Specialization, Earnings Management

JEL Classification: M4

Suggested Citation

Chen, Ken Y. and Wu, Shan-Ying and Zhou, Jian, Auditor Brand Name, Industry Specialisation, and Earnings Management: Evidence from Taiwanese Companies (2006). International Journal of Accounting, Auditing and Performance Evaluation, Vol. 3(2): 194-219, 2006, Available at SSRN: https://ssrn.com/abstract=2926285

Ken Y. Chen (Contact Author)

National Taiwan University ( email )

1 Sec. 4, Roosevelt Road
Taipei 106, 106
Taiwan
886-2-3366-9780 (Phone)

National Taiwan University ( email )

No.1, Sec. 4, Roosevelt Rd
Taipei, 106
Taiwan
886-2-33669780 (Phone)

HOME PAGE: http://www.acc.ntu.edu.tw

Shan-Ying Wu

Kun Shan University of Technology ( email )

949, Da Wan Road
Tainan Hsien 710
Taiwan

Jian Zhou

University of Hawaii at Manoa ( email )

Honolulu, HI 96822
United States

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