Why investors like it when auditors provide tax services, too

04/29/2013 | CFO.com

Investors have come to the conclusion that it is more beneficial for auditors to perform tax services as well, despite fears that the audit will not be independent, according to a study published in the Journal of the American Taxation Association. The study found that an increase in the ratio of tax fees to total fees paid to an auditor correlated with a rise in the company's earnings per share and stock price. One reason for this could be the spillover of knowledge when tax and audit services are provided by the same source.

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