Releasing Earnings when the Audit is Less Complete: Implications for Audit Quality and the Auditor/Client Relationship
研究盈余公告时审计完成度对审计质量和审计师/客户关系的影响，发现审计完成度越低，财务报表错报可能性越高，审计师变更概率也越高。
SYNOPSIS This study examines the effect of audit completeness at the annual earnings announcement date on audit quality and auditor/client retention decisions. The vast majority of companies now release earnings before the year-end audit is complete while, historically, companies would release earnings on or after the date of audit completion. Management's decision to release earnings when the audit is less complete can adversely impact audit quality and has negative implications for the overall auditor/client dynamic. We find that audits that are less complete at the earnings announcement date are associated with a higher likelihood of financial statement misstatements in audit areas that are typically performed toward the end of audit fieldwork. We also find a higher likelihood of auditor turnover during the following year. Taken together, the results suggest lower financial reporting/audit quality and higher auditor turnover for companies that release earnings when the audit is less complete. Data Availability: The data used are publicly available from the sources cited in the text.