Do Relatively More Efficient Firms Demand Additional Audit Effort (Hours)?

We examine whether firms with higher relative efficiency (operational performance) require additional audit effort (hours) to signal audit quality to demonstrate that their financial reporting systems are robust. Therefore, we use a Korean sample of publicly listed firms because of the Korean audit hour policy which mandates that audit hour information be made available for market participants. We find that client firms with higher relative efficiency have higher audit hours, suggesting that management has an incentive to demand additional audit hours for signalling purposes, and that shareholders, amongst other stakeholders, have an incentive to demand external monitoring to reduce potential agency problems. The results show that relative efficiency is a unique measure of firm performance that can provide insights into a client firm's business and audit risk. We also find evidence suggesting that audit firms do not subject clients to a fee (fee per hour) premium based on relative efficiency, supporting our finding that client firms require audit effort for signalling purposes. Thus, our results have important implications for policymakers about audit effort demand

Do Relatively More Efficient Firms Demand Additional Audit Effort (Hours)?

We examine whether firms with higher relative efficiency (operational performance) require additional audit effort (hours) to signal audit quality to demonstrate that their financial reporting systems are robust. Therefore, we use a Korean sample of publicly listed firms because of the Korean audit hour policy which mandates that audit hour information be made available for market participants. We find that client firms with higher relative efficiency have higher audit hours, suggesting that management has an incentive to demand additional audit hours for signalling purposes, and that shareholders, amongst other stakeholders, have an incentive to demand external monitoring to reduce potential agency problems. The results show that relative efficiency is a unique measure of firm performance that can provide insights into a client firm's business and audit risk. We also find evidence suggesting that audit firms do not subject clients to a fee (fee per hour) premium based on relative efficiency, supporting our finding that client firms require audit effort for signalling purposes. Thus, our results have important implications for policymakers about audit effort demand

Efficacy and Safety of Three Antiretroviral Regimens for Initial Treatment of HIV-1: A Randomized Clinical Trial in Diverse Multinational Settings

Background:Antiretroviral regimens with simplified dosing and better safety are needed to maximize the efficiency of antiretroviral delivery in resource-limited settings. We investigated the efficacy and safety of antiretroviral regimens with once-daily compared to twice-daily dosing in diverse areas of the world.Methods and Findings:1,571 HIV-1-infected persons (47% women) from nine countries in four continents were assigned with equal probability to open-label antiretroviral therapy with efavirenz plus lamivudine-zidovudine (EFV+3TC-ZDV), atazanavir plus didanosine-EC plus emtricitabine (ATV+DDI+FTC), or efavirenz plus emtricitabine-tenofovir-disoproxil fumarate (DF) (EFV+FTC-TDF). ATV+DDI+FTC and EFV+FTC-TDF were hypothesized to be non-inferior to EFV+3TC-ZDV if the upper one-sided 95% confidence bound for the hazard ratio (HR) was ≤1.35 when 30% of participants had treatment failure.An independent monitoring board recommended stopping study follow-up prior to accumulation of 472 treatment failures. Comparing EFV+FTC-TDF to EFV+3TC-ZDV, during a median 184 wk of follow-up there were 95 treatment failures (18%) among 526 participants versus 98 failures among 519 participants (19%; HR 0.95, 95% CI 0.72-1.27; p = 0.74). Safety endpoints occurred in 243 (46%) participants assigned to EFV+FTC-TDF versus 313 (60%) assigned to EFV+3TC-ZDV (HR 0.64, CI 0.54-0.76; p<0.001) and there was a significant interaction between sex and regimen safety (HR 0.50, CI 0.39-0.64 for women; HR 0.79, CI 0.62-1.00 for men; p = 0.01). Comparing ATV+DDI+FTC to EFV+3TC-ZDV, during a median follow-up of 81 wk there were 108 failures (21%) among 526 participants assigned to ATV+DDI+FTC and 76 (15%) among 519 participants assigned to EFV+3TC-ZDV (HR 1.51, CI 1.12-2.04; p = 0.007).Conclusion: EFV+FTC-TDF had similar high efficacy compared to EFV+3TC-ZDV in this trial population, recruited in diverse multinational settings. Superior safety, especially in HIV-1-infected women, and once-daily dosing of EFV+FTC-TDF are advantageous for use of this regimen for initial treatment of HIV-1 infection in resource-limited countries. ATV+DDI+FTC had inferior efficacy and is not recommended as an initial antiretroviral regimen.Trial Registration:http://www.ClinicalTrials.gov NCT00084136