Abstract

http://ssrn.com/abstract=1590811
 
 

References (78)



 
 

Citations (2)



 


 



Auditor Tenure and Audit Quality: The Role of the Demand for Unique Client Specific Knowledge


Bin Srinidhi


University of Texas at Arlington - Department of Accounting; City University of Hong Kong (CityUHK) - Department of Accountancy

Sidney Leung


City University of Hong Kong (CityUHK) - Department of Accountancy

Ferdinand A. Gul


Monash University Sunway Campus

April 16, 2010


Abstract:     
Using a sample of US firms from 1988 to 2000, we find a strong positive (weak or no) association between auditor tenure and earnings quality in client firms whose demand for unique client-specific knowledge is higher (lower). These results are consistent with the idea that learning the unique client-specific knowledge is best accomplished by long tenure. Firms requiring higher unique client-specific knowledge are identified in two ways: those with operating characteristics that diverge significantly from industry norms and those with high audit complexity as measured by volatility and audit fees. Our findings are robust to alternative specifications of earnings quality.

Number of Pages in PDF File: 50

Keywords: Mandatory Audit Firm Rotation, Auditor Tenure, Client-Specific Knowledge, Earnings Quality

JEL Classification: M42

working papers series


Download This Paper

Date posted: April 16, 2010  

Suggested Citation

Srinidhi, Bin and Leung, Sidney and Gul, Ferdinand A., Auditor Tenure and Audit Quality: The Role of the Demand for Unique Client Specific Knowledge (April 16, 2010). Available at SSRN: http://ssrn.com/abstract=1590811 or http://dx.doi.org/10.2139/ssrn.1590811

Contact Information

Bin Srinidhi (Contact Author)
University of Texas at Arlington - Department of Accounting ( email )
Arlington, TX 76013
United States
City University of Hong Kong (CityUHK) - Department of Accountancy ( email )
83 Tat Chee Avenue
Kowloon
Hong Kong
China
Sidney Leung
City University of Hong Kong (CityUHK) - Department of Accountancy ( email )
83 Tat Chee Avenue
Kowloon
Hong Kong
China
+852 2788-7924 (Phone)
+852 2788-7944 (Fax)
Ferdinand A. Gul
Monash University Sunway Campus ( email )
Jalan Lagoon Selatan
Selangor Darul Ehsan
Bandar Sunway, 46150
Malaysia
Feedback to SSRN


Paper statistics
Abstract Views: 2,445
Downloads: 600
Download Rank: 23,609
References:  78
Citations:  2

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo7 in 0.422 seconds