The Impact of the Auditor's Opinion Type and the Degree of his Industrial Specialization on the Earnings Persistence: An Empirical Study on Companies listed in the Egyptian Stock Exchange

Document Type : Original Article

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Accounting department Faculty of Commerce Beni Suef University Egyptian

Abstract

This study investigates the impact of auditor opinion and industrial specialization on Earnings Persistence. An Empirical study was conducted on a sample of 257 observations of 53 non-Financial companies listed in the Egyptian Stock Exchange for the period 2012-2016. The literature review revealed that current earnings of companies listed in the Egyptian Stock Exchange have a positive impact on their future earnings. Further, it is conclude that auditor opinion and industrial specialization can affect the relationship between current earnings of these companies and their future earnings. The empirical study revealed a positive and moral effect between current earnings of companies listed in the Egyptian Stock Exchange and their future earnings. The study also found a significant positive effect of the type of auditor opinion for the current year on the relationship between current earnings of companies listed in the Egyptian Stock Exchange and their future earnings. Finally, the study revealed a positive effect of industrial specialization on the relationship between current earnings of companies listed on the Egyptian Stock Exchange and their future earnings.

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