Does Severe Air Pollution Affect Audit Judgment?: Evidence From China

Chen, Feng; Peng, Xiaofeng; Zeng, Jianguang

doi:10.2139/ssrn.1538658

Cited by 2 publications

(6 citation statements)

References 60 publications

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“…Second, we complement the research of Chen, Peng, et al (2017) by revealing why air quality has a negative impact on audit judgement. Chen, Peng, et al (2017) referred to the productivity reduction and cognitive bias channel, but they didn't answer why productive reduction and cognitive bias induce auditors to be more aggressive. We discuss this question from psychology and cognition studies, which enhance the understanding of the impact of air quality on auditor's behaviour.…”

Section: Introductionmentioning

confidence: 94%

“…Then, one question arises naturally: why air pollution affects auditor's professional judgements? Is it because of the impact on individual's physical health that reduces the productivity (Chen, Peng, et al, 2017)? Or is it because of the induced negative mood that reduces the productivity?…”

Section: Air Quality and Perception Of Air Qualitymentioning

confidence: 99%

“…This implies that air quality may decrease auditor's professional judgement ability, making them more prone to accept optimistic accounting estimates and judgements as a result. Chen, Peng, and Zeng (2017) also documents that air pollution will reduce auditor's proclivity to issue MAOs and is positively associated with higher discretionary accruals and a higher likelihood of accounting restatements using a sample of Chinese public firms between 2003-2014. They argue that air pollution affects auditor's judgment through two separate channels, i.e.…”

Section: Introductionmentioning

confidence: 99%

“…So, the air quality standards around 2012 are different which may distort the result. There is also another possible problem associated with Chen, Peng, et al (2017). It was not until 2013 that the air quality problem attracted public attention (Baidu search index increased from 0 to 3.112).…”

Section: Introductionmentioning

confidence: 99%

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Are auditor’s professional judgments influenced by air quality?

Song

2018

China Journal of Accounting Studies

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This paper tests the influence of air quality on auditor's professional judgments using air quality data disclosed by Ministry of Ecology and Environment of the People's Republic of China in 2013-2015. We find that air pollution exposure of the client's headquarter during fieldwork days has a negative impact on the auditor's professional judgments. Further analysis shows that the influence of air quality on auditor's professional judgments pertains to periods when air pollution problem attracts public attention, in regions with air pollution and in samples with air quality differences between the audit firm and the auditee.The results indicate that it is the negative emotion induced by the perception of air pollution rather than the pollution itself that influences auditor's professional judgments. We also discover that air pollution affects auditor's professional judgments through audit effort.

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Section: Introductionmentioning

confidence: 94%

Section: Air Quality and Perception Of Air Qualitymentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Are auditor’s professional judgments influenced by air quality?

Song

2018

China Journal of Accounting Studies

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“…The influences of COVID-19 on many aspects of the economy, air pollution, and income have been explored by a number of studies (e.g., Kabir et al 2020 ; Firano and Fatine 2020 ; Malahayati et al 2021 ; Zhang et al 2022 ; Wang and Su 2020 ; Elsaid et al 2021 ; Nundy et al 2021 ; Chen et al 2021 ; Su et al 2022 ; Sun et al 2022 ; Koyama et al 2022 ; Oyenubi et al 2022 ). On the economic front, the outbreak of COVID-19 has caused great damage to world economic giants and national macroeconomics (Kabir et al 2020 ; Firano and Fatine 2020 ).…”

Section: Introductionmentioning

confidence: 99%

The impact of COVID-19 on economy, air pollution and income: evidence from China

Chen

Wang

et al. 2023

Stoch Environ Res Risk Assess

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The global pandemic caused by the outbreak of COVID-19 has posed significant risks to our health. Preventive measures such as closed management have greatly affected the economies, environments and societies of various countries. Economy, air pollution and income are three important interconnected aspects of sustainable development. However, current research lacks systematic quantitative analysis of their relationships. To fill the gap, this study adopts monthly data from January 2016 to April 2022 and constructs both a Simultaneous Equation Model (SEM) and a Time Varying Parameter Stochastic Volatility Vector Autoregressive (TVP-SV-VAR) model to empirically analyze the impact of COVID-19 on China's economy, air pollution and income. This study finds that the COVID-19 has a negative impact on China’s economy and income, and a positive impact on air pollution, and the impact of the COVID-19 is systematic. In addition, there is an inverted-U shaped relationship between air pollution and economics, and a positive correlation between economic and income. The impact of COVID-19 on the economy, air pollution and income show a process of sharp fluctuations to gradual stabilization that gradually stabilized over time. This process is time-varying in the short-term, medium-term and long-term. The impacts are persistent at three different time points (before, during and after the outbreak of COVID-19), but the negative impact on the economy and income is persistent, while the positive impact on air pollution is limited. This study provides a more systematic and dynamic understanding of the COVID-19 preventive and mitigation measures in China and even the world, which helps to provide insights into the formulation of more comprehensive planning strategies in the future. Supplementary Information The online version contains supplementary material available at 10.1007/s00477-023-02450-z.

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Does Severe Air Pollution Affect Audit Judgment?: Evidence From China

Cited by 2 publications

References 60 publications

Are auditor’s professional judgments influenced by air quality?

Are auditor’s professional judgments influenced by air quality?

The impact of COVID-19 on economy, air pollution and income: evidence from China

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