Engagement Partners Attributes and Earnings Quality: Evidence from Borsa İstanbul
Afro-Asian Journal of Finance and Accounting, Forthcoming
Posted: 19 Jul 2017 Last revised: 10 Nov 2017
Date Written: April 25, 2017
Abstract
This paper investigates the effects of engagement partners’ attributes on earnings quality using 725 firm*year observations between 2008 and 2013 from Borsa İstanbul manufacturing industry firms. We use two indicators of earnings quality to test the effects of gender, educational background, experience, and certification from among engagement partners’ attributes. Our findings emphasize that engagement partners’ attributes do not have any impact on real activities-based earnings management but have an impact on accruals-based earnings management. Female engagement partners have a negative effect on the absolute value of discretionary accruals, especially in negative discretionary accruals. On the other hand, we find that engagement partners with longer experience have negative impact on the absolute and negative discretionary accruals.
Keywords: Earnings Quality, Engagement Partner, Gender, Experience, Accruals, Real Activities
JEL Classification: M40, M41
Suggested Citation: Suggested Citation