العلاقة بين جودة الأرباح المحاسبية و المراجع الخارجي : دراسة تطبيقية على الشركات المساهمة في المملكة العربية السعودية

Abstract EN

The purpose of this study is to empirically examine the effects of audit quality on earnings quality of the Saudi listed firms during the period from 2007 to 2011.

The study proxies for audit quality using the Big 4/non-Big 4 dichotomy and auditor industry specialization.

It also proxies for earnings quality using earnings persistence.

The results indicate that clients of Big 4 auditors and clients of industry specialist auditors do not differ with respect to earnings persistence compared to clients of non-Big 4 auditors and clients of non-specialist auditors.

These results provide evidence that investors in the Saudi stock market do not regard clients of Big 4 or industry specialists as having higher earnings quality than clients of non-Big 4 or non-specialists.

These results should help Saudi capital market regulators, among others, by shedding light into aspects related to one of the potential factors affecting earnings quality.

The study also finds an increasing demand for industry specialization audit in the Kingdom of Saudi Arabia.

This finding indicates that the proxy of auditor industry specialization may play an increasing role as an indicator of the audit quality, which implies that future studies should consider taking it into account when measuring the audit quality in the Kingdom.ُ