search query: @indexterm insurance companies / total: 288
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Author: | Gaver, J.J. Paterson, J.S. |
Title: | The influence of large clients on office-level auditor oversight: Evidence from the property-casualty insurance industry |
Journal: | Journal of Accounting & Economics
2007 : JUL, VOL. 43:2-3, p. 299-320 |
Index terms: | accounting auditing insurance companies USA |
Freeterms: | auditor independence |
Language: | eng |
Abstract: | This study explores the loss-reserving practices of more than 560 insurance companies in 1993 to assess the relation btw. client influence and auditor oversight. Consistent with research of Petroni (publ. in Journal of Accounting and Economics, 1992, vol. 15, p. 485-508), it is found that financially struggling insurers tend to under-reserve. However, this behaviour is weakened when the weak insurer is important to the local auditor's practice office. This result holds across various measures of client influence, supporting the research of Reynolds and Francis (publ. in Journal of Accounting and Economics, 2001, vol. 30, p. 375-400) that auditors allow less accounting discretion to their larger clients. |
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