Audit quality and the value relevance of fair values

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Siekkinen , J V-P 2016 , ' Audit quality and the value relevance of fair values ' , International Journal of Accounting, Auditing and Performance Evaluation , vol. 13 , no. 3 , pp. 227-253 . https://doi.org/10.1504/IJAAPE.2017.10005537

Title: Audit quality and the value relevance of fair values
Author: Siekkinen, Jimi Ville-Pekka
Contributor: Hanken School of Economics, Accounting, Vaasa
Belongs to series: International Journal of Accounting, Auditing and Performance Evaluation
ISSN: 1740-8008
Abstract: This paper examines whether audit quality and auditor independence have an impact on the information quality of fair values. It is assumed that higher audit quality and higher auditor independence decrease the incentives for managerial opportunism, thereby increasing investors' trust in book values. By analysing financial firms from 28 European countries, this study finds evidence that non-audit services have a positive association with the value relevance of Level 3 fair value assets. Furthermore, the more important the client is to the auditor, the lower is the value relevance of fair value estimates (Level 3). The association between a Big 4 auditor and the information quality of fair value estimates depends on the legal traditions in the firm's home country. The association is positive or non-existent in Northern and Western European countries and negative in Southern and Eastern European countries.
Date: 2016-06-09
Subject: 512 Business and Management
IFRS 13
fair value accounting
auditor independence
fair value hierarchy
audit quality
value relevance
KOTA2017
PREM0000
0 - Not open access
1 - Self archived
1- Publicerad utomlands
0- Ingen affiliation med ett företag
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