Association between PCAOB international registration and Accounting Restatements
In recent times, many studies have investigated the impact of registration with the Public Company Accounting Oversight Board (PCAOB). The PCAOB allows the registration of audit firms from non-US countries. In this paper, we examine the association between the registration of non us companies with the PCAOB and accounting restatements due to the misapplication of accounting principles. The sample will cover all registered firms in question from 2012 to 2021. A logistic regression model was fitted to determine the probability of restatement as a function of PCAOB international registration while controlling for several other factors. Our study founds an overall decrease in firm account restatements in recent years. Also, we found a significant reduction in account restatement post-PCAOB registration.
Keywords: PCAOB, Accounting Restatement
