The Interaction of Audit Firm Quality and the Mexican Code of Best Corporate Practices on Earnings Quality

Susan Machuga () and Karen Teitel ()
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Susan Machuga: Department of Accounting, University of Hartford
Karen Teitel: Department of Economics, College of the Holy Cross

No 1005, Working Papers from College of the Holy Cross, Department of Economics

Abstract: The Mexican Code of Best Corporate Practices (Code) was established in January 2000 to increase investor confidence by encouraging more accurate financial reporting and more transparent accounting and disclosure practices by management. We investigate whether or not auditor quality interacts with the implementation of the Code affecting the quality of earnings. We find that firms that hire high quality auditors have the greatest improvements in earnings quality surrounding the implementation of the Code.

Keywords: International; Corporate Governance; Earnings Quality; Auditor Quality; Mexico (search for similar items in EconPapers)
JEL-codes: M41 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2010-12
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Citations: View citations in EconPapers (1)

Published in Review of Business Research, Volume 10, Number 1, 2010, Pages 37-55.

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Persistent link: https://EconPapers.repec.org/RePEc:hcx:wpaper:1005

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