Non-audit services and the value relevance of accounting information: a case study

Hung-Shu Fan, Ching-Lung Chen and Tyson Jung

International Journal of Revenue Management, 2010, vol. 4, issue 1, 92-117

Abstract: To increase revenues, audit firms often try to persuade their audit clients to purchase their non-audit services. Listed firms in Taiwan have to disclose their audit/non-audit fees under some conditions. It provides a context for examining whether providing non-audit services by the client's auditor influences the value relevance of accounting information in Taiwan. The empirical results indicate that the value relevance of earnings (discretionary accruals) decreases in contrast with the value relevance increase of book value for the firms with higher non-audit fee ratio. It supports that providing non-audit service by the firm’s auditor harms earnings quality.

Keywords: non-audit services; value relevance; client services; accounting information; earnings; book value; revenue management; Taiwan; auditors; auditing; fees; discretionary accruals; fee ratios. (search for similar items in EconPapers)
Date: 2010
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.inderscience.com/link.php?id=30032 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ids:ijrevm:v:4:y:2010:i:1:p:92-117

Access Statistics for this article

More articles in International Journal of Revenue Management from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker ().