Non-audit Services, Audit Firm Tenure And Earnings Management In Malaysia
The main objective of this study is to investigate the association of auditor-provided nonaudit services and audit firm tenure with earnings management in Malaysian public listed firms. Two measurements, namely, discretionary current accruals based on the performance-adjusted model developed by As...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Asian Academy of Management (AAM)
2015
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| Online Access: | http://eprints.usm.my/40034/ http://eprints.usm.my/40034/1/AAMJAF_11%281%29_2015-Art._7%28145-168%29.pdf |
| _version_ | 1848878910357372928 |
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| author | Bamahros, Hasan Mohammed Wan Hussin, Wan Nordin |
| author_facet | Bamahros, Hasan Mohammed Wan Hussin, Wan Nordin |
| author_sort | Bamahros, Hasan Mohammed |
| building | USM Institutional Repository |
| collection | Online Access |
| description | The main objective of this study is to investigate the association of auditor-provided nonaudit services and audit firm tenure with earnings management in Malaysian public
listed firms. Two measurements, namely, discretionary current accruals based on the
performance-adjusted model developed by Ashbaugh, LaFond and Mayhew (2003) and
discretionary total accruals based on the modified Jones model (1991), are employed to
estimate the level of earnings management. Our sample consists of 525 companies for
financial year 2009. The results suggest that longer audit firm tenure reduces earnings
management. However, the magnitude of non-audit fees exacerbates earnings
management. Based on the empirical evidence, any attempt to legislate audit firm
rotation in Malaysia is unwarranted. Further research is required to move toward a
policy resolution on the restriction of non-audit services in Malaysia. |
| first_indexed | 2025-11-15T17:38:50Z |
| format | Article |
| id | usm-40034 |
| institution | Universiti Sains Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T17:38:50Z |
| publishDate | 2015 |
| publisher | Asian Academy of Management (AAM) |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | usm-400342018-04-11T04:36:50Z http://eprints.usm.my/40034/ Non-audit Services, Audit Firm Tenure And Earnings Management In Malaysia Bamahros, Hasan Mohammed Wan Hussin, Wan Nordin HD28-70 Management. Industrial Management The main objective of this study is to investigate the association of auditor-provided nonaudit services and audit firm tenure with earnings management in Malaysian public listed firms. Two measurements, namely, discretionary current accruals based on the performance-adjusted model developed by Ashbaugh, LaFond and Mayhew (2003) and discretionary total accruals based on the modified Jones model (1991), are employed to estimate the level of earnings management. Our sample consists of 525 companies for financial year 2009. The results suggest that longer audit firm tenure reduces earnings management. However, the magnitude of non-audit fees exacerbates earnings management. Based on the empirical evidence, any attempt to legislate audit firm rotation in Malaysia is unwarranted. Further research is required to move toward a policy resolution on the restriction of non-audit services in Malaysia. Asian Academy of Management (AAM) 2015 Article PeerReviewed application/pdf en http://eprints.usm.my/40034/1/AAMJAF_11%281%29_2015-Art._7%28145-168%29.pdf Bamahros, Hasan Mohammed and Wan Hussin, Wan Nordin (2015) Non-audit Services, Audit Firm Tenure And Earnings Management In Malaysia. Asian Academy of Management Journal of Accounting and Finance, 11 (1). pp. 1-24. ISSN 1823-4992 http://web.usm.my/journal/aamjaf/11-1-7-2015.html |
| spellingShingle | HD28-70 Management. Industrial Management Bamahros, Hasan Mohammed Wan Hussin, Wan Nordin Non-audit Services, Audit Firm Tenure And Earnings Management In Malaysia |
| title | Non-audit Services, Audit Firm Tenure And
Earnings Management In Malaysia |
| title_full | Non-audit Services, Audit Firm Tenure And
Earnings Management In Malaysia |
| title_fullStr | Non-audit Services, Audit Firm Tenure And
Earnings Management In Malaysia |
| title_full_unstemmed | Non-audit Services, Audit Firm Tenure And
Earnings Management In Malaysia |
| title_short | Non-audit Services, Audit Firm Tenure And
Earnings Management In Malaysia |
| title_sort | non-audit services, audit firm tenure and
earnings management in malaysia |
| topic | HD28-70 Management. Industrial Management |
| url | http://eprints.usm.my/40034/ http://eprints.usm.my/40034/ http://eprints.usm.my/40034/1/AAMJAF_11%281%29_2015-Art._7%28145-168%29.pdf |