Journal article
Executive Equity Risk-Taking Incentives and Audit Pricing
The Accounting Review, Vol.90(6), pp.2205-2234
2015
Abstract
Using a large sample of U.S. firms spanning the period 2000-2010, we document a strong positive association between the sensitivity of CEO compensation portfolio to stock return volatility (vega) and audit fees. We also show that the positive association between vega and audit fees is weaker in the post-Sarbanes-Oxley Act (SOX) period. In supplementary tests, we show that the relation between vega and audit fees is stronger for firms with older CEOs and in firms where the CEO is also chairman of the board. Collectively, our results suggest that audit firms incorporate executive risk-taking incentives in the fees they charge for their services.
Details
- Title
- Executive Equity Risk-Taking Incentives and Audit Pricing
- Authors
- Yangyang Chen (Author) - Hong Kong Polytechnic UniversityFerdinand A. Gul (Author) - Monash UniversityMadhu Veeraraghavan (Author) - T A Pai Management InstituteLeon Zolotoy (Author) - University of Melbourne
- Publication details
- The Accounting Review, Vol.90(6), pp.2205-2234
- Publisher
- American Accounting Association
- DOI
- 10.2308/accr-51046
- ISSN
- 1558-7967
- Organisation Unit
- University of the Sunshine Coast, Queensland; School of Business and Creative Industries
- Language
- English
- Record Identifier
- 99679190502621
- Output Type
- Journal article
Metrics
9 Record Views
InCites Highlights
These are selected metrics from InCites Benchmarking & Analytics tool, related to this output
- Collaboration types
- Domestic collaboration
- International collaboration
- Web Of Science research areas
- Business, Finance
UN Sustainable Development Goals (SDGs)
This output has contributed to the advancement of the following goals:
Source: InCites