An Empirical Analysis of the Association between Auditor Independence and Earnings Management

2014 Fiscal Year Final Research Report

• Project/Area Number: 24730386
• Research Category: Grant-in-Aid for Young Scientists (B)
• Allocation Type: Multi-year Fund
• Research Field: Accounting
• Research Institution: Shiga University
• Principal Investigator: KASAI Naoki 滋賀大学, 経済学部, 准教授 (80584143)
• Project Period (FY): 2012-04-01 – 2015-03-31
• Keywords: 財務諸表監査 / 監査人の独立性 / 監査報酬 / 会計的利益調整行動 / 実体的利益調整行動 / 監査人の継続監査年数 / 監査市場 / 監査の品質

Outline of Final Research Achievements

In this study, I empirically investigate the relationship between auditor independence and earnings management. I find that (1) higher audit fees lead to higher accrual-based and real earnings management and (2) the association between audit fee and earnings management is contingent upon the audit partner’s tenure length; however, this finding is not robust. Additionally, the results of (1) and (2) are influenced by a firm's corporate governance system and the introduction of the audit requirement for internal control systems for financial reporting.

Free Research Field

会計学