| Summary: | 碩士 === 國立中興大學 === 會計學研究所 === 94 === There were many incidents about accounting fraud which led to a loss of confidence in accountants in recent years, and there was also an increasing number of restated previously issued financial statements causing countless losses to large numbers of its investors. This study examines restatements in the period 2002-2004, together with matched control group of firms of similar time, industry, and firm size. We use a logit model to test whether the likelihood of a restatement is related to the audit quality (using nonaudit fee, auditor size, auditor industry specialization, and auditor tenure as proxies).
We find that nonaudit fee, auditor industry specialization and auditor tenure exhibit a significant negative association with the occurrence of restatement. We cannot document a significant association between auditor size and restatement. Besides, we also investigate restatements which decreasing previous income, and find that only nonaudit fee and auditor tenure have a significant negative association with restatement. We also consider a sample of financial statements audited and financial statements reviewed. Our results indicate that audit quality have different influence on financial statements audited or those reviewed. Finally, we find out that the firms which restate their previously issued financial statements have higher risk.
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