Template-Type: ReDIF-Paper 1.0
Author-Name: Somdutta Basu
Author-Name-First: Somdutta
Author-Name-Last: Basu
Author-Email: somdutta.basu@gmail.com
Author-Workplace-Name:` Morgan Stanley
Author-Name: Suraj Shekhar
Author-Name-First: Suraj
Author-Name-Last: Shekhar
Author-Email: suraj.shekhar@ashoka.edu.in
Author-Workplace-Name:` Department of Economics, Ashoka University
Title: What's In A Name? Reputation and Monitoring in the Audit Market
Abstract: We study incentives under different information regimes by analyzing a rule change in the audit industry in the USA. Since February 2017, the name of the engagement partner has to be disclosed for all audit reports issued in the USA. We show that this quest for transparency has its pitfalls despite the increase in the level of information for investors. While the higher reputation building incentives can improve audit quality, an unintended consequence of the rule is that audit partners have a lower incentive to monitor other partners when names are disclosed. We find conditions under which the latter effect dominates the former.
length: 28
Creation-Date: 20210506
Revision-Date: 
Publication-Status: 
File-URL: https://dp.ashoka.edu.in/ash/wpaper/paper60_0.pdf
File-Format: Application/pdf 
Number: 60
Keywords: Audit
Keywords: Collective Reputation
Keywords: Disclosure
Keywords: Engagement partner
Keywords: Monitoring
Handle: RePEc:ash:wpaper:60