Audit services and financial reporting quality: The role of accounting expertise auditors
The effectiveness of the company’s financial reporting system depends on the audit’s quality. In this context, the current study examines the role of accounting and financial expertise (AFE) auditors for financial reporting quality (FRQ). Since numerous components work together to determine financia...
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2023-12-01
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| Series: | Cogent Business & Management |
| Subjects: | |
| Online Access: | https://www.tandfonline.com/doi/10.1080/23311975.2022.2164142 |
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| author | Shujah-Ur- Rahman SongSheng Chen Mamdouh Abdulaziz Saleh Al-Faryan Ilyas Ahmad Rana Yassir Hussain Shah Saud |
| author_facet | Shujah-Ur- Rahman SongSheng Chen Mamdouh Abdulaziz Saleh Al-Faryan Ilyas Ahmad Rana Yassir Hussain Shah Saud |
| author_sort | Shujah-Ur- Rahman |
| collection | DOAJ |
| description | The effectiveness of the company’s financial reporting system depends on the audit’s quality. In this context, the current study examines the role of accounting and financial expertise (AFE) auditors for financial reporting quality (FRQ). Since numerous components work together to determine financial reporting quality, measuring financial reporting quality is intrinsically complex. In this regard, the reporting quality (IFRQ) is measured by using a comprehensive Index of Financial Reporting Quality. Our study’s core and robust findings showed that the sample firms’ financial reporting quality was greatly improved by having AFE directors on the audit committee. Additionally, the current study has revealed that AFE auditors greatly cut real earnings management and improved accruals quality (alternative proxies of FRQ). By using the Generalized Method of Moments (GMM) econometric technique, which controls endogeneity, simultaneity, and unobserved heterogeneity, our research has shown that the audit committee’s accounting and financial competence directors play a unique role. This study may be useful for organizational leaders and policymakers from a practical standpoint. |
| format | Article |
| id | doaj-art-287c97c49c7d44d1b4bff1551f4cbb98 |
| institution | DOAJ |
| issn | 2331-1975 |
| language | English |
| publishDate | 2023-12-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Business & Management |
| spelling | doaj-art-287c97c49c7d44d1b4bff1551f4cbb982025-08-20T03:08:23ZengTaylor & Francis GroupCogent Business & Management2331-19752023-12-0110110.1080/23311975.2022.2164142Audit services and financial reporting quality: The role of accounting expertise auditorsShujah-Ur- Rahman0SongSheng Chen1Mamdouh Abdulaziz Saleh Al-Faryan2Ilyas Ahmad3Rana Yassir Hussain4Shah Saud5UE Business School, Division of Management and Administrative Sciences, University of Education, Lahore, PakistanSchool of Management and Economics, Beijing Institute of Technology, Beijing, Hebei, ChinaSchool of Accounting, Economics and Finance, Faculty of Business and Law, University of Portsmouth, UK & Consultant in Economics and Finance, Riyadh, Saudi ArabiaUE Business School, Division of Management and Administrative Sciences, University of Education, Lahore, PakistanUE Business School, Division of Management and Administrative Sciences, University of Education, Lahore, PakistanSchool of Management and Economics, Beijing Institute of Technology, Beijing, Hebei, ChinaThe effectiveness of the company’s financial reporting system depends on the audit’s quality. In this context, the current study examines the role of accounting and financial expertise (AFE) auditors for financial reporting quality (FRQ). Since numerous components work together to determine financial reporting quality, measuring financial reporting quality is intrinsically complex. In this regard, the reporting quality (IFRQ) is measured by using a comprehensive Index of Financial Reporting Quality. Our study’s core and robust findings showed that the sample firms’ financial reporting quality was greatly improved by having AFE directors on the audit committee. Additionally, the current study has revealed that AFE auditors greatly cut real earnings management and improved accruals quality (alternative proxies of FRQ). By using the Generalized Method of Moments (GMM) econometric technique, which controls endogeneity, simultaneity, and unobserved heterogeneity, our research has shown that the audit committee’s accounting and financial competence directors play a unique role. This study may be useful for organizational leaders and policymakers from a practical standpoint.https://www.tandfonline.com/doi/10.1080/23311975.2022.2164142Audit qualityaccounting expertisefinancial reporting qualityGMMindex of FRQ |
| spellingShingle | Shujah-Ur- Rahman SongSheng Chen Mamdouh Abdulaziz Saleh Al-Faryan Ilyas Ahmad Rana Yassir Hussain Shah Saud Audit services and financial reporting quality: The role of accounting expertise auditors Cogent Business & Management Audit quality accounting expertise financial reporting quality GMM index of FRQ |
| title | Audit services and financial reporting quality: The role of accounting expertise auditors |
| title_full | Audit services and financial reporting quality: The role of accounting expertise auditors |
| title_fullStr | Audit services and financial reporting quality: The role of accounting expertise auditors |
| title_full_unstemmed | Audit services and financial reporting quality: The role of accounting expertise auditors |
| title_short | Audit services and financial reporting quality: The role of accounting expertise auditors |
| title_sort | audit services and financial reporting quality the role of accounting expertise auditors |
| topic | Audit quality accounting expertise financial reporting quality GMM index of FRQ |
| url | https://www.tandfonline.com/doi/10.1080/23311975.2022.2164142 |
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