Using a comprehensive database of U.S. internal auditor job postings, we find that firms are 9.6% more likely to post an internal auditor job after the revelation of accounting and operational failures. Also, the demand for internal auditors is stronger when a failure is more severe. Among firms...

This study examines whether and how weak internal controls increase the risk of financial reporting fraud by top managers. There is a longstanding debate on whether control strength significantly affects fraud risk, yet little evidence on this issue. Further, there is no evidence on the...

Businesses increasingly outsource organizational functions that have financial reporting implications which requires auditors to adjust their risk assessment and audit procedures for this practice. However, PCAOB inspection reports cite deficiencies indicating that external auditors frequently...