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Corporate Tax Aggressiveness, Auditor Provided Tax Services, And Audit Quality: Evidence From Recent PCOAB Rules Concerning Independence And Tax Services
| Title: | Corporate Tax Aggressiveness, Auditor Provided Tax Services, And Audit Quality: Evidence From Recent PCOAB Rules Concerning Independence And Tax Services. |
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| Name(s): |
Carr, Kellie M., author Cao, Jian, Thesis advisor Florida Atlantic University, Degree grantor College of Business School of Accounting |
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| Type of Resource: | text | |
| Genre: | Electronic Thesis Or Dissertation | |
| Date Created: | 2017 | |
| Date Issued: | 2017 | |
| Publisher: | Florida Atlantic University | |
| Place of Publication: | Boca Raton, Fla. | |
| Physical Form: | application/pdf | |
| Extent: | 158 p. | |
| Language(s): | English | |
| Summary: | Using tax accrual quality as a proxy for audit quality, I investigate whether companies that significantly decreased APTS surrounding the effective date of the Public Company Accounting Oversight Board’s 2006 Rules on Ethics, Independence, and Tax Services experienced an improvement in audit quality after the change. Given the specific target of the PCAOB 2006 restrictions is companies aggressively avoiding taxes with the assistance of APTS, I also investigate whether companies associated with tax aggressive services are also more likely to experience an improvement in audit quality following the reductions in APTS. Results suggest an increase in audit quality due to a reduction in economic bonding following APTS restrictions. Consistent with the economic bonding theory, companies that significantly reduced APTS experienced a larger improvement in audit quality after the change compared to companies that did not significantly reduce APTS. For tax aggressive companies, those that reduced APTS did experience a significant increase in audit quality after the change compared to tax aggressive companies that did not significantly reduce APTS. Moreover, companies considered important tax clients by their audit firms that significantly reduced APTS did experience a marginally greater increase in audit quality after the change compared to other important tax clients that did not significantly reduce APTS. Overall, my results indicate that the PCOAB 2006 restrictions were effective in decreasing APTS and economic bonding, thereby leading to improved audit quality, especially among companies associated with tax aggressive services. Accordingly, concerns for loss of knowledge spillover seem to be minimal. There are few studies that investigate the effectiveness of the PCAOB 2006 restrictions on audit quality. Therefore, my study fills this void by using a tax specific measure of audit quality, tax accrual quality, to specifically examine the target of the restrictions— audit clients that are associated with aggressive tax services. My study confirms and expands APTS, economic bonding, audit quality, tax accrual quality, and tax aggressive research, and also provides insight into and support for current policy debates concerning APTS and tax aggressive services. | |
| Identifier: | FA00004884 (IID) | |
| Degree granted: | Dissertation (Ph.D.)--Florida Atlantic University, 2017. | |
| Collection: | FAU Electronic Theses and Dissertations Collection | |
| Note(s): | Includes bibliography. | |
| Subject(s): |
Auditing--Standards--United States. Corporations--Standards--United States. Corporations--Auditing. Organizational effectiveness--Measurement. Financial services industry--Management. |
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| Held by: | Florida Atlantic University Libraries | |
| Sublocation: | Digital Library | |
| Links: | http://purl.flvc.org/fau/fd/FA00004884 | |
| Persistent Link to This Record: | http://purl.flvc.org/fau/fd/FA00004884 | |
| Use and Reproduction: | Copyright © is held by the author, with permission granted to Florida Atlantic University to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder. | |
| Use and Reproduction: | http://rightsstatements.org/vocab/InC/1.0/ | |
| Host Institution: | FAU | |
| Is Part of Series: | Florida Atlantic University Digital Library Collections. |
