IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Auditing the auditors: Evidence on the recent reforms to the external monitoring of audit firms

  • Lennox, Clive
  • Pittman, Jeffrey
Registered author(s):

    This paper analyzes audit firm supervision since the Public Company Accounting Oversight Board (PCAOB) began conducting inspections. First, we find that audit clients do not perceive that the PCAOB's inspection reports are valuable for signaling audit quality. Second, we document that the information content of peer review reports fell after they became narrower in scope with the initiation of PCAOB inspections. Third, we isolate that the signaling role of peer review reports mainly stems from information that PCAOB inspectors do not publicly disclose. Collectively, our evidence implies that less is known about audit firm quality under the new regulatory regime.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.sciencedirect.com/science/article/B6V87-4W38RC1-1/2/4dfef17303287f93d4ac31da421af716
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by Elsevier in its journal Journal of Accounting and Economics.

    Volume (Year): 49 (2010)
    Issue (Month): 1-2 (February)
    Pages: 84-103

    as
    in new window

    Handle: RePEc:eee:jaecon:v:49:y:2010:i:1-2:p:84-103
    Contact details of provider: Web page: http://www.elsevier.com/locate/jae

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Hilary, Gilles & Lennox, Clive, 2005. "The credibility of self-regulation: Evidence from the accounting profession's peer review program," Journal of Accounting and Economics, Elsevier, vol. 40(1-3), pages 211-229, December.
    2. Joseph Weber & Michael Willenborg & Jieying Zhang, 2008. "Does Auditor Reputation Matter? The Case of KPMG Germany and ComROAD AG," Journal of Accounting Research, Wiley Blackwell, vol. 46(4), pages 941-972, 09.
    3. Michael Firth, 1990. "Auditor Reputation: The Impact of Critical Reports Issued by Government Inspectors," RAND Journal of Economics, The RAND Corporation, vol. 21(3), pages 374-387, Autumn.
    4. Fogarty, Timothy J., 1996. "The imagery and reality of peer review in the U.S.: Insights from institutional theory," Accounting, Organizations and Society, Elsevier, vol. 21(2-3), pages 243-267.
    5. Feltham, Gerald A. & Hughes, John S. & Simunic, Dan A., 1991. "Empirical assessment of the impact of auditor quality on the valuation of new issues," Journal of Accounting and Economics, Elsevier, vol. 14(4), pages 375-399, December.
    6. Pittman, Jeffrey A. & Fortin, Steve, 2004. "Auditor choice and the cost of debt capital for newly public firms," Journal of Accounting and Economics, Elsevier, vol. 37(1), pages 113-136, February.
    7. Sattar A. Mansi & William F. Maxwell & Darius P. Miller, 2004. "Does Auditor Quality and Tenure Matter to Investors? Evidence from the Bond Market," Journal of Accounting Research, Wiley Blackwell, vol. 42(4), pages 755-793, 09.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:eee:jaecon:v:49:y:2010:i:1-2:p:84-103. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.