Individual Auditor

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Sunny Sun - One of the best experts on this subject based on the ideXlab platform.

  • client importance institutional improvements and audit quality in china an office and Individual Auditor level analysis
    The Accounting Review, 2010
    Co-Authors: Shimin Chen, Sunny Sun
    Abstract:

    ABSTRACT: This study examines how the legal and regulatory changes in China affect the relationship between client economic importance and audit quality. At the Individual Auditor level, we find that the propensity to issue modified audit opinions (MAOs) is negatively correlated with client importance from 1995 to 2000. However, from 2001 to 2004, when the institutional environment became more investor‐friendly, the propensity to issue MAOs is positively associated with client importance. These findings are corroborated by an analysis of regulatory sanctions. Although client importance measured at the office level is also negatively related to the propensity for MAOs from 1995 to 2000 without controlling for the Auditor‐level client importance, this result is sensitive to model specification and sample composition. Our results suggest that (1) institutional improvements prompt Auditors to prioritize the costs of compromising quality over the economic benefits gained from important clients; and (2) the imp...

Zhifeng Yang - One of the best experts on this subject based on the ideXlab platform.

  • do Individual Auditors affect audit quality evidence from archival data
    The Accounting Review, 2013
    Co-Authors: Donghui Wu, Zhifeng Yang
    Abstract:

    ABSTRACT: We examine whether and how Individual Auditors affect audit outcomes using a large set of archival Chinese data. We analyze approximately 800 Individual Auditors and find that they exhibit significant variation in audit quality. The effects that Individual Auditors have on audit quality are both economically and statistically significant, and are pronounced in both large and small audit firms. We also find that the Individual Auditor effects on audit quality can be partially explained by Auditor characteristics, such as educational background, Big N audit firm experience, rank in the audit firm, and political affiliation. Our findings highlight the importance of scrutinizing and understanding audit quality at the Individual Auditor level. Data Availability: Data used in this study are publicly available from the sources described herein.

Shimin Chen - One of the best experts on this subject based on the ideXlab platform.

  • client importance institutional improvements and audit quality in china an office and Individual Auditor level analysis
    The Accounting Review, 2010
    Co-Authors: Shimin Chen, Sunny Sun
    Abstract:

    ABSTRACT: This study examines how the legal and regulatory changes in China affect the relationship between client economic importance and audit quality. At the Individual Auditor level, we find that the propensity to issue modified audit opinions (MAOs) is negatively correlated with client importance from 1995 to 2000. However, from 2001 to 2004, when the institutional environment became more investor‐friendly, the propensity to issue MAOs is positively associated with client importance. These findings are corroborated by an analysis of regulatory sanctions. Although client importance measured at the office level is also negatively related to the propensity for MAOs from 1995 to 2000 without controlling for the Auditor‐level client importance, this result is sensitive to model specification and sample composition. Our results suggest that (1) institutional improvements prompt Auditors to prioritize the costs of compromising quality over the economic benefits gained from important clients; and (2) the imp...

Donghui Wu - One of the best experts on this subject based on the ideXlab platform.

  • do Individual Auditors affect audit quality evidence from archival data
    The Accounting Review, 2013
    Co-Authors: Donghui Wu, Zhifeng Yang
    Abstract:

    ABSTRACT: We examine whether and how Individual Auditors affect audit outcomes using a large set of archival Chinese data. We analyze approximately 800 Individual Auditors and find that they exhibit significant variation in audit quality. The effects that Individual Auditors have on audit quality are both economically and statistically significant, and are pronounced in both large and small audit firms. We also find that the Individual Auditor effects on audit quality can be partially explained by Auditor characteristics, such as educational background, Big N audit firm experience, rank in the audit firm, and political affiliation. Our findings highlight the importance of scrutinizing and understanding audit quality at the Individual Auditor level. Data Availability: Data used in this study are publicly available from the sources described herein.

Yuchen Cheng - One of the best experts on this subject based on the ideXlab platform.

  • the impact of information complexity on audit failures from corporate fraud Individual Auditor level analysis
    Asia-Pacific Management Review, 2018
    Co-Authors: Yushun Hung, Yuchen Cheng
    Abstract:

    Abstract This study examines the association between related-party transactions, level of diversification and Auditor sanctions arising from corporate fraud. Sample firms are manually collected from the list of Auditor partners sanctioned due to corporate fraud published according to the Securities and Exchange Act and the Certified Public Accountants Act in Taiwan between 1992 and 2010. Empirical results indicate that the increasing complexity of corporate information with increasing aggregate monetary values of related-party transactions, especially revenue-based related-party transactions (RPTs), increases the probability of Auditor sanctions. Moreover, more complex product diversification raises the likelihood of Auditor sanctions. These results support the information asymmetry hypothesis, namely that increasing complexity of corporate information reduces the transparency of information, and thus raises information asymmetry between managers and Auditors, resulting in higher audit risk. This investigation suggests that Auditors should pay proper attention to providing professional audit work when a company has complex related-party transactions and product diversification. Analytical results could provide research-based evidence for the PCAOB to consider when formulating policy on the auditing of related party transactions (PCAOB, 2014) and the disclosure of engagement partners (PCAOB, 2011).