ABSTRACT We study off-the-clock indiscretion accusations against corporate officers and directors and examine the extent, effectiveness, and context of auditors’ response. In the year that indiscretion allegations are first publicized, auditors charge higher fees and are more likely to resign. Auditors respond to allegations against both top executives and board members. Further, reactions are strongest when allegations demonstrate a lack of individual integrity and, separately, when the audit office has previously audited other similarly accused clients. Importantly, the resulting increase in auditors’ effort partially negates the association between indiscretions and lower financial reporting quality. However, auditors are primarily reactive, rather than proactive, and their response is stronger when the accused client is less important economically. These results suggest that company leadership’s off-the-clock indiscretions are signals to auditors of poor tone at the top, but the audit response is not uniform across all clients. JEL Classifications: M41; M42; M48; G34.

中文翻译：

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审计师是否将公司领导层的非正常行为视为高层基调的信号？


摘要我们研究针对公司高管和董事的不正当行为指控，并研究审计师回应的程度、有效性和背景。在不检点指控首次公开的年份，审计师收取更高的费用，并且更有可能辞职。审计师对针对高管和董事会成员的指控做出回应。此外，当指控表明缺乏个人诚信时，或者当审计办公室之前审计过其他类似指控的客户时，反应最为强烈。重要的是，由此导致的审计师工作量的增加在一定程度上否定了不检点行为与较低的财务报告质量之间的联系。然而，审计师主要是被动的，而不是主动的，当被指控的客户在经济上不太重要时，他们的反应会更强。这些结果表明，公司领导层不时的不检点行为向审计师发出了高层语气不佳的信号，但所有客户的审计反应并不统一。 JEL 分类：M41； M42； M48； G34。