Date of Award

8-2012

Degree Type

Dissertation

Embargo Date

9-19-2012

Degree Name

Doctor of Philosophy (PhD)

Department

Business Administration

Advisor(s)

Johann J. Comprix

Second Advisor

Randy Elder

Keywords

audit quality, earnings management, real earnings management, small audit firms

Subject Categories

Accounting | Business Administration, Management, and Operations

Abstract

This paper examines the monitoring role of small audit firms (i.e., those with 100 or fewer clients who are subject to different levels of oversight by the PCAOB) on earnings management. Specifically, I examine the relationship between earnings manipulations and the use of small audit firms. I find that small audit firms are less able to constrain managers' opportunistic use of discretionary accruals. However I find no evidence that small audit firms are associated with real activities manipulation. By investigating a specific group of audit firms that are the smallest in the audit market, this study extends our understanding of the role of audit firm size in audit quality.

Access

Open Access