Auditor style and comparability of financial statements

Subject Areas : Management Accounting

Fryidoon Rahnamay Roodposhti ¹ ( استاد دانشگاه آزاد اسلامی، واحد علوم و تحقیقات تهران، گروه حسابداری، تهران، ایران . )
Hamidreza Vakili Fard ² ( دانشیار دانشگاه آزاد اسلامی، واحد علوم و تحقیقات تهران، گروه حسابداری، تهران، ایران. )
Fazllolah Lak ³ ( استادیار دانشگاه خلیج فارس، گروه علوم پایه، بوشهر، ایران. )
Abdolreza Mohseni ⁴ ( دانشجوی دکترای حسابداری دانشگاه آزاد اسلامی، واحد علوم و تحقیقات تهران، گروه حسابداری، تهران، ایران )

Received: 2014-06-02 Accepted : 2014-10-07 Published : 2015-06-22

Keywords: Auditor Style, Comparability, Audit organization, Discretionary Accruals, Accounting Earnings,

Abstract :

The term auditor style to determine a unique set of internal working rules each audit firm to perform audit standards and application generally accepted accounting principles between their clients are used. Audit style implies that two companies audited by the same auditor, subject to the same audit style, are more likely to have comparable earnings than two firms audited by two different audit firms with different styles.The sample consists of 63 companies listed in Tehran Stock Exchange for the period 2002 to 2013. The tests are based on pairs of firms and a total of 4344 pairs of firms as observations are used. In the present study used correlation method and multiple regression and is performed regression analysis for hypothesis test.The findings show that clients of other audit firms member of certified public accountants society in the same industry and year than to clients of audit organization have more similar in accruals and earnings structure. Also clients of other audit firms in the same industry and year than to their non-clients have more similar in accruals and earnings structure.Finally the findings show that audit style is effective to comparability of financial statements.