Auditor Gender and Corporate Earnings Management Behavior in Private Finnish Firms

24 Pages Posted: 2 Dec 2009 Last revised: 4 Dec 2009

See all articles by Jyrki Niskanen

Jyrki Niskanen

University of Kuopio - Department of Business and Management

Jukka Karjalainen

University of Eastern Finland - Business School

Mervi Niskanen

University of Eastern Finland

Jussi Karjalainen

affiliation not provided to SSRN

Date Written: December 1, 2009

Abstract

The purpose of this paper is to investigate whether auditor gender has an impact on the magnitude of corporate earnings management in small and medium-sized private Finnish firms. Our results concerning gender differences in audit practices are twofold. First, when we regress the absolute (unsigned) earnings management on a gender dummy and a set of control variables, we find that female auditors allow for more discretion in income reporting than their male colleagues. When the analysis is conducted separately for sub-samples of income increasing and income decreasing discretionary accruals, the results suggest that female auditors are more conservative than their male colleagues.

Keywords: Auditor gender, Earnings management, Private firms

JEL Classification: M42

Suggested Citation

Niskanen, Jyrki and Karjalainen, Jukka and Niskanen, Mervi and Karjalainen, Jussi, Auditor Gender and Corporate Earnings Management Behavior in Private Finnish Firms (December 1, 2009). Available at SSRN: https://ssrn.com/abstract=1515276 or http://dx.doi.org/10.2139/ssrn.1515276

Jyrki Niskanen (Contact Author)

University of Kuopio - Department of Business and Management ( email )

Kuopio, 70211
Finland

Jukka Karjalainen

University of Eastern Finland - Business School ( email )

P.O. Box 1627
Kuopio, FI-70211
Finland

Mervi Niskanen

University of Eastern Finland ( email )

PL 1627
Kuopio, 70211
Finland

Jussi Karjalainen

affiliation not provided to SSRN ( email )

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