The Credibility of Self-Regulation: Evidence from the Accounting Profession's Peer Review - Archive ouverte HAL Access content directly
Journal Articles Journal of Accounting and Economics Year : 2005

The Credibility of Self-Regulation: Evidence from the Accounting Profession's Peer Review

(1) , (1)
1

Abstract

Following the Sarbanes-Oxley Act, self-regulated peer reviews at accounting firms were replaced by independent inspections conducted by the Public Company Accounting and Oversight Board. Critics of self-regulation had argued that the peer review program lacked credibility. This paper tests whether the opinions issued by the peer reviewers provided credible information to clients about audit firm quality. We find audit firms gained clients after receiving clean opinions from their reviewers and lost clients after receiving modified or adverse opinions. This suggests peer review opinions provided credible information about quality differences between audit firms.

Dates and versions

hal-00482306 , version 1 (10-05-2010)

Identifiers

Cite

Gilles Hilary, Clive Lennox. The Credibility of Self-Regulation: Evidence from the Accounting Profession's Peer Review. Journal of Accounting and Economics, 2005, Vol.40, n°1-3, p.211-229. ⟨10.1016/j.jacceco.2005.03.002|⟩. ⟨hal-00482306⟩

Collections

HEC
75 View
0 Download

Altmetric

Share

Gmail Facebook Twitter LinkedIn More