Audit committee financial expertise, corporate governance, and the voluntary switch from auditor-provided to non-auditor-provided tax services

Albring, Susan M.; Robinson, Dahlia; Robinson, Michael N.

doi:10.1016/j.adiac.2013.12.007

Cited by 41 publications

(51 citation statements)

References 31 publications

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“…Since the decision to use an incumbent auditor for tax services is endogenously determined, some studies examine the rationale for procuring tax services from incumbent auditors. Albring et al (2014) find that corporate governance attributes, such as board independence, the audit committee's accounting expertise, and separation of the CEO and chairman of the board, play a role in a firm's decision to switch to a non-auditor provider for tax services. Lassila et al (2010) provide evidence that firms with strong corporate governance and relatively high levels of tax and operational complexity are more likely to retain their auditor for tax services.…”

Section: Empirical Modelmentioning

confidence: 98%

Auditor-provided tax services and stock price crash risk

Habib

Hasan

2015

Accounting and Business Research

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This paper examines whether auditor-provided tax services affect stock price crash risk: an important consideration for stock investors. Provision of tax services by incumbent auditors could accentuate or attenuate crash risk depending on whether such services give rise to knowledge spillover or impair auditor independence. The study investigates two channels through which tax services might affect crash risk: earnings management in tax expenses and tax avoidance. Also examined is whether the association between tax services and crash risk is moderated by the particular business strategy that organizations pursue. A two-stage model is used to control for the potential endogeneity inherent in the selection of auditors for tax services. Empirical findings reveal that auditor-provided tax services attenuate crash risk by constraining both earnings management in tax expenses and tax avoidance. Further evidence shows that auditor-provided tax services reduce crash risk for firms following innovator business strategies. Taken together, empirical findings reported in this study support knowledge spillover benefits, that is, insights gained from tax services can enhance audit effectiveness.

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Section: Empirical Modelmentioning

confidence: 98%

Auditor-provided tax services and stock price crash risk

Habib

Hasan

2015

Accounting and Business Research

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“…Allowing pharmacists to adjust the dosage of some prescribed medications (Martinez et al, 2013) can create ripples through the system that only a systemic mindset may be able to fathom. Sometimes such new rules are formulated in the wake of major catastrophes or watershed events, such as the requirements that audit and consulting firms operate at arm's length (Benston and Hartgraves, 2002;Albring et al, 2014) following the Enron-Andersen disaster or the development of a code of ethics for civil engineers adopted after the Kansas City Hyatt Regency collapse (Pfatteicher, 2000). These examples merely hint at an avenue that his better adapted to the PS environment than controls, and more effective than "gentle nudges.…”

Section: Emergence Control and Influencementioning

confidence: 99%

Professional service supply chains⋆

Harvey

2016

J of Ops Management

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Professional service (PS) exchanges are seldom narrowly bounded in time and space. This conceptual paper discusses prolonged PS sequences involving different professionals and different types of professionals. It is framed by the dual concepts of service episodes, representing the client's perspective and experience, and PS supply chains, that is, organized sequences of professional, clerical, and technical services explicitly set up to provide specific results, such as producing a financial product, designing a house, or replacing a hip. Four illustrative, empirically inspired situations are used to characterize episodes and supply chains. Each exemplar, two each from the health and social work sectors, is real and draws on publicly available data. The richness of the public information is a reflection of the fact that each is some form of failure or "disaster" (Altay and Ramirez, 2010). This dual conceptualization leads to a holistic perspective obtained by using the complex adaptive systems framework (Dooley and Van de ven, 1999, Levin, 1998) as a lens. The paper concludes with a discussion of the dynamics of such service systems and some proposals for a research agenda.

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“…Thus, it has been an unresolved debate concerning the potential importance/ effect of board members' equity ownership on both the board functional performance and firm performance. Albring et al (2013), opined that in the USA, the Blue Ribbon Committee (1999), among others, suggests that director stock ownership should reduce agency problems and therefore the need for external monitoring. Thus, in an attempt to make a proper alignment of the interest of director and shareholders, many boards have implemented stock ownership guidelines and holding requirements for directors, leading to a substantial rise in the ownership of managers and directors but in Nigeria, there exist ambiguities and challenges regarding the directors share ownership status (CBN, 2008).…”

Section: Board Equity Ownership (Moderator)mentioning

confidence: 99%