فهرست نشریات علمی دسترسی آزاد ایران

This study examines the relationship between cosmetic accounting and the risk of litigation with the auditor, moderated by corporate governance. This study examined the association between cosmetic accounting and auditor litigation risk, taking into account the moderating role of corporate governance. The sample consists of financial data from 113 companies listed on Tehran Stock Exchange during 2016-2023 (904 firm-years). The results are based on multivariate regression models. In the current study, board characteristics were considered as an indicator of corporate governance. The results show that cosmetic accounting has a significant positive impact on the risk of legal disputes with the auditor. In addition, board independence has a significant positive effect on the relationship between cosmetic accounting and the risk of litigation with the auditor. However, board size has no significant effect on this relationship. Further tests show that cosmetic accounting plays a crucial role in the risk of litigation with auditors (audit fees) for larger companies compared to smaller companies. In addition, the size of the board of directors is decisive for smaller companies, while the independence of the board of directors is more decisive for larger companies. Further findings suggest that when faced with cosmetic accounting, auditors tend to increase their audit fees to mitigate audit risk, leading to an increase in abnormal audit fees.