Mr the Number

inherent Control Weaknesses and Client take a chance Management RANDAL elder* YAN ZHANG** JIAN cabbage*** NAN ZHOU**** We study canvassors client lay on the line vigilance in the premiere year of the Sarbanes-Act Oxley (SOX) 404 implementation, and find that a pecking allege exists among canvasors strategies to sh be curtail risk resulting from internal manage weaknesses. We first examine the relation between internal manipulate weaknesses and audit fees, modify opinions, and auditor resignations, respectively, and establish that these are workable strategies to manage control risk on a stand-alone basis. We as well as find that changes in audit fees and changes in modified opinions are positively associated with changes in describe internal control weaknesses. When we ask these strategies simultaneously, descriptive depict suggests that a pecking graze exists among auditors client risk management strategies. Ordered logit analyses farther confirm that, as clien ts control risk increases, auditors are possible to respond in the order of audit fee adjustments, modified opinions, and auditor resignations. Our comprehensive evidence suggests that auditors use an array of reproducible strategies to manage client-related control risk.

Keywords: Internal Control Weaknesses, Client Risk Management, scrutinise Fee and Audit Opinion, Auditor Resignation *siege of Syracuse University **SUNY-Binghamton ***SUNY-Binghamton and Nanyang Technological University ****HKUST and SUNY-Binghamton We thank Jean Bedard, Ayesha Dey, Denise Dickins, Weili Ge, Karla Johnstone, grade Kohlbeck, Ryan LaFond, Clive Lennox, and especially an anonymous reviewer for d! etailed and insightful suggestions that fork out significantly improved the paper. We also thank workshop participants at the 2006 HKUST pass Symposium on Accounting Research, the 2006 Annual Conference on pecuniary Economics and Accounting at Georgia estate University, the 2007 American Accounting Association (AAA) Annual Meeting, the 2007 AAA Auditing Midyear Meeting, the 2007...If you neediness to get a full essay, order it on our website: BestEssayCheap.com

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