Signing auditors’ foreign experience and audit pricing |
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| Institution: | 1. School of Business, Qingdao University, Qingdao, 266071, Shandong province, China;2. School of Accounting, Guizhou University of Finance and Economics, Guiyang, 550025, Guizhou province, China;3. School of Accounting, Shanghai University of Finance and Economics, Shanghai, 200433, Shanghai, China;1. Department of Management, Università Politecnica delle Marche, Ancona, Italy;2. Department of Economics and Social Science, Università Politecnica delle Marche, Ancona, Italy;1. Department of Financial Engineering, Ajou University, Suwon, 16499, Republic of Korea;2. Department of Applied Mathematics & Institute of Natural Science, Kyung Hee University, Yongin, 17104, Republic of Korea;3. Department of Mathematical Sciences, Seoul National University, Seoul, 08826, Republic of Korea;1. Graduate School of Economics, Kobe University, 2-1 Rokko-dai, Nada, Kobe, 657-8501, Japan;2. Institute of Social and Economic Research, Osaka University, 6-1, Mihogaoka, Ibaraki, Osaka, 567-0047, Japan;1. Texas A&M University, Department of Finance, Mays Business School, College Station, TX, 77843, USA;2. University of Valladolid (Spain), NRU Higher School of Economics (Russia), School of Business and Economics, Avda. Valle Del Esgueva 6, 47011, Valladolid, Spain;3. University of Valladolid, School of Business and Economics, Avda. Valle Del Esgueva 6, 47011, Valladolid, Spain |
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| Abstract: | This study investigates whether signing auditors who have foreign experience affect audit fees. Using a sample of 20,712 firm-year observations from the Chinese stock market during the period of 2007–2017, this paper finds that signing auditors’ foreign education experience is significantly positively associated with audit fees, suggesting that signing auditors with foreign education experience can earn audit fee premiums. Furthermore, audit firm size reinforces the positive relation between signing auditors with foreign education experience and audit fees. In addition, above findings are robust to a variety of sensitivity tests using alternative measures of audit fees and signing auditors with foreign education experience and our conclusions are still stand after using the PSM, Heckman two-step approach, Placebo test and differences-in-differences method to address the potential endogeneity problem. |
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| Keywords: | Signing auditors Foreign education experience Audit firm size Audit pricing |
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