Can industry information disclosure improve audit quality?
We investigate the impact of industry information disclosure (IID) on audit quality in Chinese listed companies from 2010 to 2021, by constructing a staggered difference-in-differences model based on the implementation of the IID guidelines in the Shanghai and Shenzhen stock exchanges in 2013 as an...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Elsevier
2023-12-01
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| Series: | China Journal of Accounting Research |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S1755309123000370 |
| _version_ | 1797454348972720128 |
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| author | Chen Qiao Guojian Zheng Ying Zheng |
| author_facet | Chen Qiao Guojian Zheng Ying Zheng |
| author_sort | Chen Qiao |
| collection | DOAJ |
| description | We investigate the impact of industry information disclosure (IID) on audit quality in Chinese listed companies from 2010 to 2021, by constructing a staggered difference-in-differences model based on the implementation of the IID guidelines in the Shanghai and Shenzhen stock exchanges in 2013 as an exogenous shock. Audit quality is significantly improved after the implementation of the IID guidelines. We also use a parallel trend test, different measurements of key variables, propensity score matching, a placebo test and different samples, to ensure the validity of our findings. IID enhances audit quality by improving auditor independence, professionalism and audit engagement, particularly in firms with high-quality and numerous IIDs, high auditor rankings, strong auditor industry expertise, IIDs with a negative tone and low R&D investment. We demonstrate the effectiveness of the IID guidelines from the perspective of auditing. |
| first_indexed | 2024-03-09T15:35:59Z |
| format | Article |
| id | doaj.art-6257486985c14d11b7c7a8403b735af0 |
| institution | Directory Open Access Journal |
| issn | 1755-3091 |
| language | English |
| last_indexed | 2024-03-09T15:35:59Z |
| publishDate | 2023-12-01 |
| publisher | Elsevier |
| record_format | Article |
| series | China Journal of Accounting Research |
| spelling | doaj.art-6257486985c14d11b7c7a8403b735af02023-11-26T05:12:14ZengElsevierChina Journal of Accounting Research1755-30912023-12-01164100327Can industry information disclosure improve audit quality?Chen Qiao0Guojian Zheng1Ying Zheng2School of Economics and Management, Changsha University of Science and Technology, Changsha, ChinaSchool of Business, Sun Yat-sen University, China; Center for Accounting, Finance and Institutions, Sun Yat-sen University, ChinaSchool of Business, Sun Yat-sen University, China; Center for Accounting, Finance and Institutions, Sun Yat-sen University, China; Corresponding author at: School of Business, Sun Yat-sen University, China.We investigate the impact of industry information disclosure (IID) on audit quality in Chinese listed companies from 2010 to 2021, by constructing a staggered difference-in-differences model based on the implementation of the IID guidelines in the Shanghai and Shenzhen stock exchanges in 2013 as an exogenous shock. Audit quality is significantly improved after the implementation of the IID guidelines. We also use a parallel trend test, different measurements of key variables, propensity score matching, a placebo test and different samples, to ensure the validity of our findings. IID enhances audit quality by improving auditor independence, professionalism and audit engagement, particularly in firms with high-quality and numerous IIDs, high auditor rankings, strong auditor industry expertise, IIDs with a negative tone and low R&D investment. We demonstrate the effectiveness of the IID guidelines from the perspective of auditing.http://www.sciencedirect.com/science/article/pii/S1755309123000370IIDAudit qualityAudit independenceAudit professionalismAudit effort |
| spellingShingle | Chen Qiao Guojian Zheng Ying Zheng Can industry information disclosure improve audit quality? China Journal of Accounting Research IID Audit quality Audit independence Audit professionalism Audit effort |
| title | Can industry information disclosure improve audit quality? |
| title_full | Can industry information disclosure improve audit quality? |
| title_fullStr | Can industry information disclosure improve audit quality? |
| title_full_unstemmed | Can industry information disclosure improve audit quality? |
| title_short | Can industry information disclosure improve audit quality? |
| title_sort | can industry information disclosure improve audit quality |
| topic | IID Audit quality Audit independence Audit professionalism Audit effort |
| url | http://www.sciencedirect.com/science/article/pii/S1755309123000370 |
| work_keys_str_mv | AT chenqiao canindustryinformationdisclosureimproveauditquality AT guojianzheng canindustryinformationdisclosureimproveauditquality AT yingzheng canindustryinformationdisclosureimproveauditquality |