Auditing: A Journal of Practice and Theory http://scitation.aip.org/ Auditing: A Journal of Practice and Theory Additional Journal Content http://link.aip.org/link/?JPT/28/i/1&agg=rss <br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, i (2009)] published Wed Oct 21, 2009. Author Information http://link.aip.org/link/?JPT/28/329/1&agg=rss <br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, 329 (2009)] published Wed Oct 21, 2009. Auditing: A Journal of Practice & Theory Editor's Report http://link.aip.org/link/?JPT/28/325/1&agg=rss <br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, 325 (2009)] published Wed Oct 21, 2009. Data Diagnostics Using Second-Order Tests of Benford's Law http://link.aip.org/link/?JPT/28/305/1&agg=rss Mark J. Nigrini and Steven J. Miller<br/> SUMMARY: Auditors are required to use analytical procedures to identify the existence of unusual transactions, events, and trends. Benford's Law gives the expected patterns of the digits in numerical data, and has been advocated as a test for the authenticity and reliability of transaction level acc ... [Auditing: A Journal of Practice & Theory 28, 305 (2009)] published Wed Oct 21, 2009. Risk Shifts in the Market for Audits: An Examination of Changes in Risk for Second Tier Audit Firms http://link.aip.org/link/?JPT/28/93/1&agg=rss Chris E. Hogan and Roger D. Martin<br/> SUMMARY: The market for audit services has been affected in recent years by significant changes like the demise of Andersen and the implementation of the Sarbanes-Oxley Act of 2002. One impact of these market changes has been an increase in the frequency of auditor switches, and in particular, the f ... [Auditing: A Journal of Practice & Theory 28, 93 (2009)] published Wed Oct 21, 2009. Resolving Disputed Financial Reporting Issues: Effects of Auditor Negotiation Experience and Engagement Risk on Negotiation Process and Outcome http://link.aip.org/link/?JPT/28/65/1&agg=rss Helen L. Brown and Karla M. Johnstone<br/> SUMMARY: In an experiment involving a dyadic negotiation between a computer-simulated client and practicing auditors, we examine the effects of engagement risk and auditor negotiation experience on the process and outcomes of client-auditor negotiations. We find that auditors with lower negotiation ... [Auditing: A Journal of Practice & Theory 28, 65 (2009)] published Wed Oct 21, 2009. Assessing France's Joint Audit Requirement: Are Two Heads Better than One? http://link.aip.org/link/?JPT/28/35/1&agg=rss Jere R. Francis, Chrystelle Richard, and Ann Vanstraelen<br/> SUMMARY: We examine auditor choice for listed companies in France where two (joint) auditors are required by law. This unique setting creates more complex auditor choice than the typical Big 4/non-Big 4 dichotomy in other countries, and we study if a firm's ownership structure affects its auditor-pa ... [Auditing: A Journal of Practice & Theory 28, 35 (2009)] published Wed Oct 21, 2009. Audit Fees at U.S. Non-Profit Organizations http://link.aip.org/link/?JPT/28/289/1&agg=rss Thomas E. Vermeer, K. Raghunandan, and Dana A. Forgione<br/> SUMMARY: Non-profit organizations account for a significant share of the U.S. national economy. Some recent scandals and governance failures in non-profits have led to increased scrutiny of non-profits, including new state laws related to external audits. In this paper, we extend audit fee research ... [Auditing: A Journal of Practice & Theory 28, 289 (2009)] published Wed Oct 21, 2009. An Examination of the Effects of Procedural Safeguards on Intentions to Anonymously Report Fraud http://link.aip.org/link/?JPT/28/273/1&agg=rss Steven E. Kaplan, Kurt Pany, Janet A. Samuels, and Jian Zhang<br/> SUMMARY: The Sarbanes-Oxley Act of 2002 (SOX, Sec. 301) requires audit committees of public companies to establish procedures for employee anonymous reporting of concerns regarding questionable accounting, internal control, or auditing matters. Audit committees have great flexibility in their implem ... [Auditing: A Journal of Practice & Theory 28, 273 (2009)] published Wed Oct 21, 2009. Why Do Some Accelerated Filers with SOX Section 404 Material Weaknesses Provide Early Warning under Section 302? http://link.aip.org/link/?JPT/28/247/1&agg=rss Dana R. Hermanson and Zhongxia (Shelly) Ye<br/> SUMMARY: During the first year of the SOX Section 404 reporting requirements (effective November 15, 2004), many adverse Section 404 audit reports were a surprise in that management had not previously warned investors of the internal control deficiencies (ICDs) in SEC filings under Section 302 (effe ... [Auditing: A Journal of Practice & Theory 28, 247 (2009)] published Wed Oct 21, 2009. Forced Audit Firm Change, Continued Partner-Client Relationship, and Financial Reporting Quality http://link.aip.org/link/?JPT/28/227/1&agg=rss Charles J. P. Chen, Xijia Su, and Xi Wu<br/> SUMMARY: This study extends Blouin et al. ([BGR] 2007) by providing partner-level evidence regarding the effect of continued auditor-client relationships on financial reporting quality over a three-year post-switch period. Using a sample of forced audit firm changes in China where the identities of ... [Auditing: A Journal of Practice & Theory 28, 227 (2009)] published Wed Oct 21, 2009. Are the Reputations of the Large Accounting Firms Really International? Evidence from the Andersen-Enron Affair http://link.aip.org/link/?JPT/28/199/1&agg=rss Steven F. Cahan, David Emanuel, and Jerry Sun<br/> SUMMARY: This paper investigates the stock price reaction of Andersen's non-U.S. clients around two key dates leading up to Andersen's demise, i.e., January 10, 2002, when Andersen announced it had shredded documents related to the Enron audit, and February 4, 2002, when Enron's board released a rep ... [Auditing: A Journal of Practice & Theory 28, 199 (2009)] published Wed Oct 21, 2009. The Impact of Regulation on Auditor Fees: Evidence from the Sarbanes-Oxley Act http://link.aip.org/link/?JPT/28/171/1&agg=rss Aloke Ghosh and Robert Pawlewicz<br/> SUMMARY: We examine changes in auditor fees around the Sarbanes-Oxley Act (SOX). Audit fees are expected to increase after SOX due to an increase in both audit effort and auditors' expected legal liability. Our results indicate an economically large increase in audit fees following the enactment of ... [Auditing: A Journal of Practice & Theory 28, 171 (2009)] published Wed Oct 21, 2009. Experimental Tests of a Descriptive Theory of Combined Auditee Risk Assessment http://link.aip.org/link/?JPT/28/145/1&agg=rss Scott D. Vandervelde, Richard M. Tubbs, Albert Schepanski, and William F. Messier, Jr.<br/> SUMMARY: This research experimentally investigates how auditors make combined auditee risk judgments during the planning of the audit of an account balance in a client's financial statements. Experimental tests were performed of whether the predictions of the AICPA model of auditee risk determinatio ... [Auditing: A Journal of Practice & Theory 28, 145 (2009)] published Wed Oct 21, 2009. The Impact of Positive and Negative Mood on the Hypothesis Generation and Ethical Judgments of Auditors http://link.aip.org/link/?JPT/28/119/1&agg=rss Anna M. Cianci and James Lloyd Bierstaker<br/> SUMMARY: This paper examines the impact of mood on the hypothesis generation and ethical judgments of auditors. Prior psychology research documents different effects of negative and positive mood on information processing such that negative (positive) mood leads to more systematic (heuristic) proces ... [Auditing: A Journal of Practice & Theory 28, 119 (2009)] published Wed Oct 21, 2009. A Model and Literature Review of Professional Skepticism in Auditing http://link.aip.org/link/?JPT/28/1/1&agg=rss Mark W. Nelson<br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, 1 (2009)] published Wed Oct 21, 2009. Additional Journal Content http://link.aip.org/link/?JPT/28/i/1&agg=rss <br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, i (2009)] published Thu May 14, 2009. Author Information http://link.aip.org/link/?JPT/28/263/1&agg=rss <br/> Abstract not available. [Auditing: A Journal of Practice & Theory 28, 263 (2009)] published Thu May 14, 2009. Audit Committee Financial Expertise, Litigation Risk, and Corporate Governance http://link.aip.org/link/?JPT/28/241/1&agg=rss Jagan Krishnan and Jong Eun Lee<br/> SUMMARY: Recent debates on audit committee financial expertise have focused on accounting and nonaccounting financial experts. A significant proportion of firms do not appoint accounting financial experts (i.e., persons with specialized accounting/auditing experience) to their audit committees. We e ... [Auditing: A Journal of Practice & Theory 28, 241 (2009)] published Thu May 14, 2009. Financial Restatements and Shareholder Ratifications of the Auditor http://link.aip.org/link/?JPT/28/225/1&agg=rss Li-Lin Liu, K. Raghunandan, and Dasaratha Rama<br/> SUMMARY: Regulators and legislators have focused significant attention on financial statement restatements in recent years, and the U.S. Securities and Exchange Commission (SEC) and financial statement users view restatements as audit failures. The SEC (2000, 2003a) suggests that shareholder voting ... [Auditing: A Journal of Practice & Theory 28, 225 (2009)] published Thu May 14, 2009. Financial Restatements, Audit Fees, and the Moderating Effect of CFO Turnover http://link.aip.org/link/?JPT/28/205/1&agg=rss Dorothy A. Feldmann, William J. Read, and Mohammad J. Abdolmohammadi<br/> SUMMARY: We examine post-restatement audit fees and executive turnover for a sample of firms that restated their 2003 financial statements. We investigate and find evidence that audit fees are higher for restatement firms compared with a matched-pair control group of non-restatement firms. We propos ... [Auditing: A Journal of Practice & Theory 28, 205 (2009)] published Thu May 14, 2009. An Examination of the Effects of Auditor Rank on Pre-Negotiation Judgments http://link.aip.org/link/?JPT/28/191/1&agg=rss Ken T. Trotman, Arnold M. Wright, and Sally Wright<br/> SUMMARY: Auditors often encounter contentious accounting and reporting issues that require resolution with the client. The purpose of the current study is to examine the impact of auditor rank on pre-negotiation judgments. To address these issues, 25 managers and 18 partners examine a rich experimen ... [Auditing: A Journal of Practice & Theory 28, 191 (2009)] published Thu May 14, 2009. Audit Fees for Initial Audit Engagements Before and After SOX http://link.aip.org/link/?JPT/28/171/1&agg=rss Hua-Wei Huang, K. Raghunandan, and Dasaratha Rama<br/> SUMMARY: Legislators, regulators, and the media have expressed concerns that auditors lowball the fees for initial-year audits and that such fee discounts can lead to reduced audit quality. We hypothesize that initial-year audit fee discounts will be less likely in the post-SOX period than in the pr ... [Auditing: A Journal of Practice & Theory 28, 171 (2009)] published Thu May 14, 2009. Going-Concern Audit Opinions and the Provision of Nonaudit Services: Implications for Auditor Independence of Bankrupt Firms http://link.aip.org/link/?JPT/28/153/1&agg=rss Joseph Callaghan, Mohinder Parkash, and Rajeev Singhal<br/> SUMMARY: Researchers in the area of auditor independence have examined the relationship between auditors' opinions and auditor-provided services. While DeFond et al. (2002) and Geiger and Rama (2003) fail to find auditor impairment for distressed U.S. companies, Sharma (2001) and Sharma and Sidhu (2 ... [Auditing: A Journal of Practice & Theory 28, 153 (2009)] published Thu May 14, 2009. The Value of Assurance on Voluntary Nonfinancial Disclosure: An Experimental Evaluation http://link.aip.org/link/?JPT/28/137/1&agg=rss Paul J. Coram, Gary S. Monroe, and David R. Woodliff<br/> SUMMARY: This study examines whether assurance on the voluntary provision of nonfinancial performance indicators affects the stock price estimates of a group of sophisticated financial report users. We conducted an experiment where participants were provided with a case study containing excerpts fro ... [Auditing: A Journal of Practice & Theory 28, 137 (2009)] published Thu May 14, 2009. The Effects of Audit Review Format on Review Team Judgments http://link.aip.org/link/?JPT/28/95/1&agg=rss Christopher P. Agoglia, Richard C. Hatfield, and Joseph F. Brazel<br/> SUMMARY: The promulgation of standards (e.g., PCAOB 2004b; IFAC 2008b) highlights the importance of workpaper documentation quality and its influence on audit quality. Our study matches audit workpaper preparers with reviewers to examine how alternative workpaper review methods affect sequential aud ... [Auditing: A Journal of Practice & Theory 28, 95 (2009)] published Thu May 14, 2009. Do Client-Prepared Internal Control Documentation and Business Process Flowcharts Help or Hinder an Auditor's Ability to Identify Missing Controls? http://link.aip.org/link/?JPT/28/79/1&agg=rss James Lloyd Bierstaker, James E. Hunton, and Jay C. Thibodeau<br/> SUMMARY: The purpose of this study is to examine the extent to which client-prepared internal control documentation and business process flowcharts affect auditors' ability to detect missing internal controls. A total of 395 experienced auditors participated in a two (internal control matrix: blank ... [Auditing: A Journal of Practice & Theory 28, 79 (2009)] published Thu May 14, 2009. Improving Assessments of Another Auditor's Competence http://link.aip.org/link/?JPT/28/53/1&agg=rss Noel Harding and Ken T. Trotman<br/> SUMMARY: Auditing standards require auditors to assess the competence of their colleagues. However, previous studies have shown that auditors' assessments of their colleagues' competence are inaccurate and overconfident, potentially leading to a reduction in audit effectiveness. In two related studi ... [Auditing: A Journal of Practice & Theory 28, 53 (2009)] published Thu May 14, 2009. Auditor Disaffiliation Program in China and Auditor Independence http://link.aip.org/link/?JPT/28/29/1&agg=rss Ferdinand A. Gul, Heibatollah Sami, and Haiyan Zhou<br/> SUMMARY: This study examines whether the disaffiliation program introduced by the Chinese government improved auditor independence and whether auditor quality affects this relationship. Auditor independence is measured in terms of the likelihood of receiving a qualified report and the level of earni ... [Auditing: A Journal of Practice & Theory 28, 29 (2009)] published Thu May 14, 2009. Does Mandatory Audit Firm Rotation Enhance Auditor Independence? Evidence from Spain http://link.aip.org/link/?JPT/28/113/1&agg=rss Emiliano Ruiz-Barbadillo, Nieves Gomez-Aguilar, and Nieves Carrera<br/> SUMMARY: In this study, we document evidence on the impact of mandatory rotation of audit firms on auditor independence using Spanish archival data. Rotation of audit firms every nine years was mandatory in Spain from 19881995. Although the rule was never enforced, the Spanish context provides a uni ... [Auditing: A Journal of Practice & Theory 28, 113 (2009)] published Thu May 14, 2009. Covariation Assessments with Costly Information Collection in Audit Planning: An Experimental Study http://link.aip.org/link/?JPT/28/1/1&agg=rss Ananda R. Ganguly and Jacqueline S. Hammersley<br/> SUMMARY: In this paper we report the results of two experiments that investigate auditing covariation-estimate revisions when there are countervailing incentives for effectiveness and efficiency. Covariation estimates assess the degree of association between a Clue that auditors might observe, and i ... [Auditing: A Journal of Practice & Theory 28, 1 (2009)] published Thu May 14, 2009. Auditors' Cross-Sectional and Temporal Analysis of Account Relations in Identifying Financial Statement Misstatements http://link.aip.org/link/?JPT/27/79/1&agg=rss Scott D. Vandervelde, Yining Chen, and Robert A. Leitch<br/> SUMMARY: In order to plan and perform an effective audit, auditing standards and existing research call for auditors to consider relations between accounts (American Institute of Certified Public Accountants [AICPA] 2006; Leitch and Chen 2003; Vandervelde 2006) and how various pieces of evidence fit ... [Auditing: A Journal of Practice & Theory 27, 79 (2009)] published Wed Mar 18, 2009. Changes in the Audit Environment and Auditors' Propensity to Issue Going-Concern Opinions http://link.aip.org/link/?JPT/27/55/1&agg=rss Neil L. Fargher and Liwei Jiang<br/> SUMMARY: The high-profile collapses during the period 2000 to 2002 resulted in increased litigation against auditors, higher insurance costs, increased media scrutiny, and increased regulatory review of the auditing profession. Prior research suggests that auditors' decisions were more conservative ... [Auditing: A Journal of Practice & Theory 27, 55 (2009)] published Wed Mar 18, 2009. Auditor Independence and Auditor-Provided Tax Service: Evidence from Going-Concern Audit Opinions Prior to Bankruptcy Filings http://link.aip.org/link/?JPT/27/31/1&agg=rss Dahlia Robinson<br/> SUMMARY: This study examines whether auditors' provision of tax services impairs auditor independence by focusing on auditors' going-concern opinions among a sample of bankruptcy filing firms. The evidence from the bankruptcy setting is particularly salient given that the bankruptcy of corporations ... [Auditing: A Journal of Practice & Theory 27, 31 (2009)] published Wed Mar 18, 2009. A Summary of Research and Enforcement Release Evidence on Confirmation Use and Effectiveness http://link.aip.org/link/?JPT/27/253/1&agg=rss Paul Caster, Randal J. Elder, and Diane J. Janvrin<br/> SUMMARY: Confirmations are extensively used and are often perceived by practitioners to be one of the most persuasive forms of audit evidence. Yet academic research has found limitations that restrict confirmation effectiveness for many management assertions. In addition, a number of problems with f ... [Auditing: A Journal of Practice & Theory 27, 253 (2009)] published Wed Mar 18, 2009. Financial Statement Fraud: Insights from the Academic Literature http://link.aip.org/link/?JPT/27/231/1&agg=rss Chris E. Hogan, Zabihollah Rezaee, Richard A. Riley, Jr., and Uma K. Velury<br/> SUMMARY: We summarize relevant academic research findings to contribute to the Public Company Accounting Oversight Board (PCAOB) project on financial statement fraud and to offer insights and conclusions relevant to academics, standard setters, and practitioners. We discuss the characteristics of fi ... [Auditing: A Journal of Practice & Theory 27, 231 (2009)] published Wed Mar 18, 2009. Partner Familiarity and Audit Fees: Evidence from Former Andersen Clients http://link.aip.org/link/?JPT/27/217/1&agg=rss Thomas E. Vermeer, Dasaratha V. Rama, and K. Raghunandan<br/> SUMMARY: In this study we examine the audit fees for two types of former Andersen clients: those that followed their former Andersen partner to a new audit firm and those that did not. Using data from Public Accounting Report on the acquisition of Andersen offices, we find that about half of the And ... [Auditing: A Journal of Practice & Theory 27, 217 (2009)] published Wed Mar 18, 2009. Dual-Class Shares and Audit Pricing: Evidence from the Canadian Markets http://link.aip.org/link/?JPT/27/199/1&agg=rss Samer Khalil, Michel L. Magnan, and Jeffrey R. Cohen<br/> SUMMARY: This paper investigates whether audit fees vary with the wedge between cash flow rights and control rights arising from the presence of dual-class share structures. Dual-class shares exist in firms having two or more classes of shares with disproportionate voting rights. They affect audit f ... [Auditing: A Journal of Practice & Theory 27, 199 (2009)] published Wed Mar 18, 2009. Form versus Substance: The Implications for Auditing Practice and Research of Alternative Perspectives on Corporate Governance http://link.aip.org/link/?JPT/27/181/1&agg=rss Jeffrey R. Cohen, Ganesh Krishnamoorthy, and Arnold M. Wright<br/> SUMMARY: The objective of this paper is to provide a more comprehensive view of corporate governance than that considered by the traditional agency literature predominately employed in auditing and accounting studies of governance. Specifically, we discuss three widely recognized additional theoreti ... [Auditing: A Journal of Practice & Theory 27, 181 (2009)] published Wed Mar 18, 2009. Earnings Management of Firms Reporting Material Internal Control Weaknesses under Section 404 of the Sarbanes-Oxley Act http://link.aip.org/link/?JPT/27/161/1&agg=rss Kam C. Chan, Barbara Farrell, and Picheng Lee<br/> SUMMARY: The main objectives of the Sarbanes-Oxley Act of 2002 are to improve the accuracy and reliability of corporate disclosure. Under Section 404 of the Sarbanes-Oxley Act, the external auditor has to report an assessment of the firm's internal controls and attest to management's assessment of t ... [Auditing: A Journal of Practice & Theory 27, 161 (2009)] published Wed Mar 18, 2009. The Effect of Moods on Auditors' Inventory Valuation Decisions http://link.aip.org/link/?JPT/27/137/1&agg=rss Janne O. Y. Chung, Jeffrey R. Cohen, and Gary S. Monroe<br/> SUMMARY: This paper investigates the effect of different mood statesspecifically positive, neutral, and negative moodon inventory valuation decisions. Psychological research suggests that different mood states can lead to different professional judgments in the performance of an ambiguous task. Comp ... [Auditing: A Journal of Practice & Theory 27, 137 (2009)] published Wed Mar 18, 2009. The Influence of Audit Firm Specialization on Analysts' Forecast Errors http://link.aip.org/link/?JPT/27/109/1&agg=rss Jeff L. Payne<br/> SUMMARY: This study investigates audit firm specialization in settings where managers have incentives to modify earnings to achieve analysts' earnings forecasts. The results indicate that audit firms that have a large market share of clients within a particular industry, and audit firms that receive ... [Auditing: A Journal of Practice & Theory 27, 109 (2009)] published Wed Mar 18, 2009. Revenue Manipulation and Restatements by Loss Firms http://link.aip.org/link/?JPT/27/1/1&agg=rss Jeffrey L. Callen, Sean W. G. Robb, and Dan Segal<br/> SUMMARY: This paper investigates the relation between the extent of a firm's past and expected future losses or negative cash flows and the ex ante probability that it will manipulate revenues. When a firm has a string of losses or negative cash flows, traditional valuation models do not yield relia ... [Auditing: A Journal of Practice & Theory 27, 1 (2009)] published Wed Mar 18, 2009.