Question: Again consider the situation of Exercise 12.24. Table 12.10 summarizes auditor positions regarding proposed changes in accounting standards that would decrease client firms' reported earnings.

Again consider the situation of Exercise 12.24. Table 12.10 summarizes auditor positions regarding proposed changes in accounting standards that would decrease client firms' reported earnings. Determine whether the relationship between auditor position and the size of the client firm is the same for earnings-decreasing changes in accounting standards as it is for earnings-increasing changes in accounting standards. Justify your answer using both a statistical test and a graphical analysis.
TABLE 12.10
Auditor Positions Regarding Earnings-Decreasing Changes in Accounting Standards

In Favor Opposed Total Large Firms 27 29 56 Small Firms 152 154 306 Total 179 183 362

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