We investigate the relationship between auditor brand name,industry specialisation, and earnings management as measured by discretionaryaccruals for a sample of listed companies in Taiwan, where the litigation riskagainst auditors is much less than the risk in the USA. We find that the use ofBig 5 auditors is related to less earnings management in Taiwan. We also findthat industry specialist auditors are related to less income increasing earningsmanagement, which, to our knowledge, has not been demonstrated by any auditquality and earnings management studies in Taiwan.
International Journal of Accounting, Auditing, and Performance Evaluation, v. x, no. x, xxxx, 2006