Indirect effects of regulatory change: Evidence from the acceleration of the 10-K filing deadline

Dong, Bei; Nash, Jonathan D.; Xu, Le

doi:10.1016/j.adiac.2022.100582

Cited by 4 publications

(5 citation statements)

References 59 publications

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“…, 2016; Lopez and Peters, 2011, 2012). Dong et al. (2022) complement these studies by demonstrating resource strain can affect clients of a single audit office differently.…”

Section: Additional Analyses and Robustness Testsmentioning

confidence: 83%

“…Prior studies on audit office quality define office-level variables using the entire client portfolio, focusing on how resource constraints uniformly affect clients of an audit office (Bills et al, 2016;Peters, 2011, 2012). Dong et al (2022) complement these studies by demonstrating resource strain can affect clients of a single audit office differently. Our primary tests are performed using a sample that includes only a subset of audit office clients, those that did not issue a restatement.…”

Section: Restatement Issuersmentioning

confidence: 83%

“…A heuristic scheduling model with limited resources suggests that high-priority jobs may cause a shift in resource allocation (Wiest, 1967). Consistent with this mode, in the audit environment, changes in the volume or timing of work can stress resources and temporarily impair office-level audit quality (Dong et al. , 2022; Bills et al.…”

Section: Introductionmentioning

confidence: 99%

“…Even when changes in the timing or amount of work are engagement specific, because of resource constraints, concurrent engagements can be affected (Skomra et al. , 2023; Dong et al. , 2022; Lambert et al.…”

Section: Introductionmentioning

confidence: 99%

“…concentration) all have adverse effects on audit quality at the office level (Czerney et al, 2019;Bills et al, 2016;Lopez and Peters, 2012). Even when changes in the timing or amount of work are engagement specific, because of resource constraints, concurrent engagements can be affected (Skomra et al, 2023;Dong et al, 2022;Lambert et al, 2017).…”

Section: Introductionmentioning

confidence: 99%

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The effect of restatements on office-level audit quality

Nash,

Bailey

2024

MAJ

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Purpose This study aims to provide evidence on how the issuance of a nonreliance restatement affects non-restating clients of the same audit office. Design/methodology/approach To test the effect of restatement issuance on office-level quality, this study runs regressions using both input- and output-based measures of audit quality. Findings This study finds that in the years where one or more clients of an audit office issue a restatement, audit effort is lower for non-restating clients of the same office. When two or more clients issue a restatement, other clients are charged lower audit fees, file later and are more likely to experience an audit failure. Originality/value This study contributes to the literature on office-level audit quality and provides an explanation for the longitudinal correlation of office-level audit failures.

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“…, 2016; Lopez and Peters, 2011, 2012). Dong et al. (2022) complement these studies by demonstrating resource strain can affect clients of a single audit office differently.…”

Section: Additional Analyses and Robustness Testsmentioning

confidence: 83%

Section: Restatement Issuersmentioning

confidence: 83%