Interplay between Accounting Conservatism, Auditing Conservatism and Quality of Earnings in Oman


  • Mawih Kareem Al Ani Dhofar University, Sultanate of Oman
  • H Gin Chong Prairie View A&M University, USA


Accounting conservatism, Auditing conservatism, Quality of earnings, Oman, Emerging economy


This paper examines the impact of accounting conservatism and auditing conservatism on earnings quality. Four proxies were used to measure earnings quality; persistence, accrual quality, value relevance and earnings smoothness. We use the published annual reports of all the listed firms in the Muscat Securities Market (MSM) for the 6-year period from 2012-2017 to assess the interplay between accounting conservatism, auditing conservatism and earnings quality. The result reveals a positive and significant effect of auditing conservatism on earnings quality but no significant effect of accounting conservatism on earnings quality in terms earnings smoothness. This implies users tend to rely on auditors’ reports when assessing earnings quality. Our results are robust to the inclusion of four control variables; size of the firm, risk, audit firm size and industry type, the use of an additional analysis of one special case of auditing conservatism and earnings quality, and tests of potential relationship between auditing conservatism. The findings have implications to regulators when formulating standards and guidelines, auditors in the course of an audit, investors in reviewing the financial statements, and preparers when preparing their financial reports. The study recommends that Omani stockholders as well as international stockholders rely heavily on auditing conservatism which means that stockholders are prepared to receive modified audit reports.


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How to Cite

Al Ani, M. K., & Chong, H. G. (2021). Interplay between Accounting Conservatism, Auditing Conservatism and Quality of Earnings in Oman. International Journal of Economics, Management and Accounting, 29(1), 167–205. Retrieved from