Material Internal Control Weaknesses And Earnings Management In The Post-SOX Environment

Does SOX 404 Have Teeth? Consequences of the Failure to Report Existing Internal Control Weaknesses

We identify a sample of firms with restatements attributable to underlying control weaknesses, some which had previously reported these weaknesses as required by SOX 404 and some of which acknowledged them only after announcing the related restatement. We then examine whether various penalties that could serve as enforcement mechanisms for SOX 404 differ across these two groups. We find no evid...

CEOs and Earnings Management: The Distributional Anomalies of Discretionary Accruals in Post- SOX Era

This thesis examines anomalies related to the discretionary accruals usage during the tenures of CEOs in listed U.S. companies since the implementation of Sarbanes-Oxley Act. The approach used in this thesis is quantitative in nature. Four well-known discretionary accruals models: Healy model, DeAngelo model, Jones model and modified Jones are used in to separate discretionary accruals from the...

Pre and Post-SOX Association between Audit Firm Tenure and Earnings Management Risk

This study investigates the effect of audit firm tenure on earnings management risk. We perform multivariate regression analyses to examine the empirical relationship between auditor tenure and the probability of earnings manipulation using Beneish’s (1999) framework. The analysis covering a five year time-period surrounding the enactment of SOX produces evidence of a negative relationship betw...

A Model for Investigating Internal Control Weaknesses

Comparing Earnings Management in Germany and the USA

This study presents empirical evidence concerning the effect of different accounting standard on earnings management. Prior studies have shown that accounting standards influence earnings management. Tighter accounting standards regime restricts management’s descretion to manipulate accruals, and at the same time, induce more costly real earnings management activities. To investigate this iss...