Effects of Country-Level Legal, Extra-Legal and Political Institutions on Auditing: A Cross-Country Analysis of the Auditor Specialization Premium

Author

Bin Sirinidhi, Hong Kong Polytechnic University
Chee Yeow LIM, Singapore Management UniversityFollow
Mahmud Hossain, Nanyang Technological University

Publication Type

Journal Article

Version

publishedVersion

Publication Date

6-2009

Abstract

In this cross-country study of the specialist auditor premium, which spans the US and 12 other countries, we provide evidence that country-level institutional strength increases average audit fees, but reduces the incremental demand for specialist auditors. This finding supports the hypothesis that strong institutions and the demand for specialist knowledge act as substitutes in providing the requisite assurance of financial statements.

Keywords

Audit specialization, Legal protection, Extra-legal institutions, Political economy

Discipline

Accounting | Business Law, Public Responsibility, and Ethics | International Business

Research Areas

Corporate Governance, Auditing and Risk Management

Publication

Journal of Contemporary Accounting and Economics

Volume

5

Issue

1

First Page

34

Last Page

46

ISSN

1815-5669

Identifier

10.1016/j.jcae.2009.03.001

Publisher

Elsevier

Citation

Sirinidhi, Bin; LIM, Chee Yeow; and Hossain, Mahmud. Effects of Country-Level Legal, Extra-Legal and Political Institutions on Auditing: A Cross-Country Analysis of the Auditor Specialization Premium. (2009). Journal of Contemporary Accounting and Economics. 5, (1), 34-46.
Available at: https://ink.library.smu.edu.sg/soa_research/131

Copyright Owner and License

Publisher

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.

Additional URL

https://doi.org/10.1016/j.jcae.2009.03.001