Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye
Ahmet Onay, Serdar BenligirayThis study examines the relationship between auditing factors and earnings management practices. Specifically, it investigates the effects of audit opinion and audit firm size on earnings management. The methodology is a combination of qualitative and quantitative analyses. We constructed multivariate regression models to test research hypotheses. The contextual analysis of qualified audit reports provides definite segmentations for cross-sectional analysis. The findings suggest that a qualified audit opinion is a significant predictor of incomeincreasing earnings management practices in Türkiye. Major audit firms suppress these practices in line with the argument that they perceive them as a potential litigation threat to their reputation and assets. Firms potentially managing their earnings are observed to have more debt, less equity, and greater financial distress. This research provides comprehensive information for capital market regulators, investors, and other stakeholders to evaluate audit performance in mitigating earnings management problems. The present study contributes to the literature by providing evidence from Türkiye.
Anahtar Kelimeler: Earnings management, audit opinion, discretionary accruals, audit quality, financial distress
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APA
Onay, A., & Benligiray, S. (2024). Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye. Istanbul Business Research, 53(3), 327-350. https://doi.org/10.26650/ibr.2024.53.1332658
AMA
Onay A, Benligiray S. Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye. Istanbul Business Research. 2024;53(3):327-350. https://doi.org/10.26650/ibr.2024.53.1332658
ABNT
Onay, A.; Benligiray, S. Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye. Istanbul Business Research, [Publisher Location], v. 53, n. 3, p. 327-350, 2024.
Chicago: Author-Date Style
Onay, Ahmet, and Serdar Benligiray. 2024. “Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye.” Istanbul Business Research 53, no. 3: 327-350. https://doi.org/10.26650/ibr.2024.53.1332658
Chicago: Humanities Style
Onay, Ahmet, and Serdar Benligiray. “Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye.” Istanbul Business Research 53, no. 3 (Mar. 2025): 327-350. https://doi.org/10.26650/ibr.2024.53.1332658
Harvard: Australian Style
Onay, A & Benligiray, S 2024, 'Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye', Istanbul Business Research, vol. 53, no. 3, pp. 327-350, viewed 10 Mar. 2025, https://doi.org/10.26650/ibr.2024.53.1332658
Harvard: Author-Date Style
Onay, A. and Benligiray, S. (2024) ‘Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye’, Istanbul Business Research, 53(3), pp. 327-350. https://doi.org/10.26650/ibr.2024.53.1332658 (10 Mar. 2025).
MLA
Onay, Ahmet, and Serdar Benligiray. “Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye.” Istanbul Business Research, vol. 53, no. 3, 2024, pp. 327-350. [Database Container], https://doi.org/10.26650/ibr.2024.53.1332658
Vancouver
Onay A, Benligiray S. Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye. Istanbul Business Research [Internet]. 10 Mar. 2025 [cited 10 Mar. 2025];53(3):327-350. Available from: https://doi.org/10.26650/ibr.2024.53.1332658 doi: 10.26650/ibr.2024.53.1332658
ISNAD
Onay, Ahmet - Benligiray, Serdar. “Does Auditing Detect and Suppress Earnings Management? Evidence from Türkiye”. Istanbul Business Research 53/3 (Mar. 2025): 327-350. https://doi.org/10.26650/ibr.2024.53.1332658
