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Are Audit Partners' Compensation and Audit Quality related to their Consulting Revenues?
Peking University.
BI Norwegian Business School.
Umeå universitet, Samhällsvetenskapliga fakulteten, Handelshögskolan vid Umeå universitet, Företagsekonomi. BI Norwegian Business School, Norway.
2021 (engelsk)Inngår i: Journal of Accounting and Public Policy, ISSN 0278-4254, E-ISSN 1873-2070, Vol. 40, nr 6, artikkel-id 106896Artikkel i tidsskrift (Fagfellevurdert) Published
Abstract [en]

Recent accounting scandals have triggered renewed interest in the debate concerning whether audit firms should be banned from providing consulting services. Compared to the voluminous studies on consulting services to audit clients (i.e., non-audit services, hereafter NAS), little has been done to investigate consulting services to non-audit clients (hereafter CS). This study examines whether audit partners' revenues from CS are associated with: i) partners' compensation, and ii) audit quality (AQ), while controlling for revenues from NAS and auditing. We choose the Norwegian setting because of the unique and proprietary data on CS at the audit partner level. Our results provide initial evidence that partners' compensation is positively associated with their revenues generated from CS. Regarding AQ, our findings indicate no relation between AQ and partners' revenues from CS. This study contributes to the recent debate on multidisciplinary audit firms and should be of interest to regulators, audit firms, and users of audited financial statements.

sted, utgiver, år, opplag, sider
Elsevier, 2021. Vol. 40, nr 6, artikkel-id 106896
Emneord [en]
Consulting services, Non-audit clients, Partner compensation, Audit quality
HSV kategori
Identifikatorer
URN: urn:nbn:se:umu:diva-186762DOI: 10.1016/j.jaccpubpol.2021.106896ISI: 000724523400010Scopus ID: 2-s2.0-85114729555OAI: oai:DiVA.org:umu-186762DiVA, id: diva2:1586435
Tilgjengelig fra: 2021-08-20 Laget: 2021-08-20 Sist oppdatert: 2023-03-24bibliografisk kontrollert

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