Open Access Senior Thesis
Bachelor of Arts
This study examines the relationship between executives and their independent auditor to see if there is a conflict of interest in their interaction. This study was motivated by the meltdowns, partially caused by fraudulent accounting, of many public companies in the late 1990s and early 2000s and the consequent passage of the Sarbanes-Oxley Act. This study examines the variables of audit fees, fees for other services, and auditor tenure to see if they are connected with the occurrence of an SEC-prompted restatement. The results show no significant correlation between amount of fees and the likelihood of an SEC-prompted restatement but indicate a negative correlation between length of executive-auditor relationship and the occurrence of an SEC-prompted restatement.
Lyford, Henry, "Conflict of Interest?: Executive-Auditor Relationship and the Likelihood of a SEC-Prompted Restatement" (2010). CMC Senior Theses. 39.