The Manager and the Auditor in a Double Moral Hazard Setting: Efficiency through Contingent Feess and Insurance Contracts

Our article integrates the managers care in the literature on auditors liability. With unobservable efforts, we face a double moral hazard setting. It is well-known that efficient liability rules without punitive damages do not exist under these circumstances. However, we show that the problem can be solved through strict liability, con-tingent auditing fees, and fair insurance contracts. Neither punitive damages nor deductibles above the damages are required.

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Year of publication:	1998-10-02
Authors:	Feess, Eberhard ; Nell, Martin
Publisher:	Universität <Frankfurt, Main> / Fachbereich Wirtschaftswissenschaften
Subject:	Moral hazard \| Wirtschaftsprüfung \| auditing \| Versicherung \| Haftung \| liability

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Extent:	204800 bytes 12 p. application/pdf
Series:	Universität Frankfurt - Fachbereich Wirtschaftswissenschaften - Internetquellen
Type of publication:	Book / Working Paper
Language:	English
Classification:	Business administration. General ; Individual Working Papers, Preprints ; No country specification
Source:	USB Cologne (business full texts)