Is There a Trade-Off Between Accrual-Based and Real Earnings Management Activities in the Presence of (fe) Male Auditors?

Owusu A., Zalata A. M., Omoteso K., Elamer A.

Journal of Business Ethics, vol.175, no.4, pp.815-836, 2022 (SSCI, Scopus) identifier

  • Nəşrin Növü: Article / Article
  • Cild: 175 Say: 4
  • Nəşr tarixi: 2022
  • Doi nömrəsi: 10.1007/s10551-020-04672-5
  • jurnalın adı: Journal of Business Ethics
  • Jurnalın baxıldığı indekslər: Social Sciences Citation Index (SSCI), Scopus, IBZ Online, International Bibliography of Social Sciences, Periodicals Index Online, ABI/INFORM, Business Source Elite, Business Source Premier, Communication & Mass Media Index, Communication Abstracts, EBSCO Education Source, EconLit, Education Abstracts, Gender Studies Database, PAIS International, Philosopher's Index, Psycinfo, Public Affairs Index, DIALNET
  • Səhifə sayı: pp.815-836
  • Açar sözlər: Abnormal accruals, Auditor gender, Real activities
  • Açıq Arxiv Kolleksiyası: Məqalə
  • Adres: Bəli

Qısa məlumat

Prior research suggests that the presence of high-quality auditors (i.e. proxied by audit firm characteristics) constrains accrual-based earnings management, but it inadvertently leads to higher real activities manipulation. We investigate whether such trade-off exists between accrual-based and real earnings management activities in the presence of female or male auditors. We use a sample of UK firms for the period 2009 to 2016 and find that firms audited by female auditors do not resort to a higher-level real activities manipulation when their ability to engage in accruals management is constrained. Overall, our results suggest that the benefits of hiring female auditors (i.e. less accrual-based earnings management) are overwhelmingly higher than the costs they might bring to the client firms (i.e. higher real activities manipulation).