Does the PCAOB international inspection program improve audit quality for non-US-listed foreign clients?

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review

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Original languageEnglish
Pages (from-to)15-36
Journal / PublicationJournal of Accounting and Economics
Issue number1
Online published25 Apr 2017
Publication statusPublished - Aug 2017


We examine whether the Public Company Accounting Oversight Board (PCAOB) international inspection program improves audit quality for a sample of non-US-listed foreign public client companies from 55 countries audited by foreign (i.e., non-US) auditors. For a sample of non-US-listed clients of PCAOB-registered foreign auditors, we find that initial PCAOB inspections improve audit quality, over and above the threat of such inspections, for foreign auditors’ non-US-listed foreign clients. Our findings document the benefits of PCAOB international inspections for foreign investors in non-US-listed foreign companies which could increase the acceptability of the PCAOB international inspection program abroad.

Research Area(s)

  • Audit quality, Foreign auditors, Non-US-listed foreign public companies, PCAOB international inspection program, Positive externality