Management earnings forecasts disaggregation and audit fees: International evidence

Shan, Liwei; San, Ziyao; Tsang, Albert

doi:10.1111/ijau.12225

Cited by 8 publications

(11 citation statements)

References 75 publications

(186 reference statements)

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Table 2 presents the summary statistics for the full sample. The mean value of AuditFee is 2.750 (median 2.720), with a standard deviation of 0.137, which is consistent with the findings of Shan et al (2021). The mean (median) for CSI is 0.219 (0.000), which is comparable with the findings of Frost et al (2022).…”

Section: Methodssupporting

confidence: 90%

“…The overall pattern of distribution by industry is generally consistent with the potential environmental and social concerns that are associated with specific industries.Table2presents the summary statistics for the full sample. The mean value of AuditFee is 2.750 (median 2.720), with a standard deviation of 0.137, which is consistent with the findings ofShan et al (2021). The mean (median) for CSI is 0.219 (0.000), which is comparable with the findings ofFrost et al (2022).…”

supporting

confidence: 84%

“…

{AuditFee}_{it} goodbreak= α_{0} goodbreak+ α_{1} {CSI}_{it - 1} goodbreak+ α_{2} {Mediacoverage}_{it - 1} goodbreak+ α_{3} {Size}_{it - 1} goodbreak+ α_{4} {GeoSegment}_{it - 1} goodbreak+ α_{5} {Accrual}_{it - 1} goodbreak+ α_{6} {ROA}_{it - 1} goodbreak+ α_{7} {Leverage}_{it - 1} goodbreak+ α_{8} {Loss}_{it - 1} goodbreak+ α_{9} {StkExch}_{it - 1} goodbreak+ α_{10} {MB}_{it - 1} goodbreak+ α_{11} {Crosslisting}_{it - 1} goodbreak+ α_{12} {Litigation}_{it - 1} goodbreak+ α_{13} italicBig italic4 {Auditor}_{it - 1} goodbreak+ α_{14} {Institution}_{it - 1} goodbreak+ α_{15} {Insider}_{it - 1} goodbreak+ Country Fixed Effect goodbreak+ Industry Fixed Effect goodbreak+ Year Fixed Effect goodbreak+ ε_{it}

where i indexes firm, t indexes year and AuditFee it is the natural logarithm of audit fees in millions of US dollars for firm i in year t . Following previous studies (e.g., Ball et al, 2012; Craswell et al, 1995; Gotti et al, 2012; Han et al, 2013; LaFond & Watts, 2008; Shan et al, 2021; Simon & Francis, 1988; Simunic, 1980), we control for the following characteristics: firm size ( Size ), an indicator variable that equals 1 if the auditor is a Big 4 auditor (...…”

Section: Methodsmentioning

confidence: 99%

“…Some studies find that more opaque or complex firms, such as those that are geographically diversified, tend to demand more audit services (Choi et al, 2008; Simunic, 1980). Therefore, following the literature (e.g., Bhattacharya et al, 2003; George et al, 2013; Kim et al, 2012; Shan et al, 2021), we include the following controls: the total number of geographical segments of a firm ( GeoSegment ) and firm‐level financial opacity, measured as country–industry–year‐adjusted total scaled accruals ( Accrual ). Following Francis (1984) and Hay et al (2006), we also include the following control variables for firm‐specific risk: leverage ( Leverage ), profitability ( ROA ) and financial loss ( Loss ).…”

Section: Methodsmentioning

confidence: 99%

“…where i indexes firm, t indexes year and AuditFee it is the natural logarithm of audit fees in millions of US dollars for firm i in year t. Following previous studies (e.g., Ball et al, 2012;Craswell et al, 1995;Gotti et al, 2012;Han et al, 2013;LaFond & Watts, 2008;Shan et al, 2021;Simon & Francis, 1988;Simunic, 1980), we control for the following characteristics: firm size (Size), an indicator variable that equals 1 if the auditor is a Big 4 auditor (Big4Auditor), the market-tobook ratio of equity (MB), the total number of stock exchanges on which a firm is listed (StkExch) and the percentage of shares held by institutional investors (Institution).…”

Section: Methodsmentioning

confidence: 99%

See 4 more Smart Citations

Media coverage of corporate social irresponsibility and audit fees: International evidence

et al. 2022

Self Cite

View full text Add to dashboard Cite

This study uses a large sample of firms from 35 countries to examine how media coverage of corporate social irresponsibility (CSI) affects audit fees. We document a positive and significant relationship between media coverage of CSI and audit fees. Further evidence indicates that this positive relationship is less pronounced for firms with a higher level of commitment to corporate social responsibility (CSR) performance but is more pronounced for firms domiciled in countries with stronger investor protections, higher regulatory quality and higher CSR disclosure requirements. Taken together, these findings support the conjecture that CSI media coverage increases auditors' risk and thereby increases audit fees. Moreover, our findings suggest that the effect of media coverage of CSI on audit fees varies with country‐level institutional characteristics and the degree of firms' substantive commitment to CSR performance.

show abstract

Section: Methodssupporting

confidence: 90%

supporting

confidence: 84%

“…

{AuditFee}_{it} goodbreak= α_{0} goodbreak+ α_{1} {CSI}_{it - 1} goodbreak+ α_{2} {Mediacoverage}_{it - 1} goodbreak+ α_{3} {Size}_{it - 1} goodbreak+ α_{4} {GeoSegment}_{it - 1} goodbreak+ α_{5} {Accrual}_{it - 1} goodbreak+ α_{6} {ROA}_{it - 1} goodbreak+ α_{7} {Leverage}_{it - 1} goodbreak+ α_{8} {Loss}_{it - 1} goodbreak+ α_{9} {StkExch}_{it - 1} goodbreak+ α_{10} {MB}_{it - 1} goodbreak+ α_{11} {Crosslisting}_{it - 1} goodbreak+ α_{12} {Litigation}_{it - 1} goodbreak+ α_{13} italicBig italic4 {Auditor}_{it - 1} goodbreak+ α_{14} {Institution}_{it - 1} goodbreak+ α_{15} {Insider}_{it - 1} goodbreak+ Country Fixed Effect goodbreak+ Industry Fixed Effect goodbreak+ Year Fixed Effect goodbreak+ ε_{it}

Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

See 3 more Smart Citations

Media coverage of corporate social irresponsibility and audit fees: International evidence

et al. 2022

Self Cite

View full text Add to dashboard Cite

show abstract

Information overload research in accounting: a systematic review of the literature

Hartmann

Weißenberger

2023

Manag Rev Q

View full text Add to dashboard Cite

This paper reviews literature in the domain of information overload in accounting. The underlying psychological concepts of information load (as applied in accounting research) are summarized, and a framework to discuss findings in a structured way is proposed. This framework serves to make causes, consequences, and countermeasures transparent. Variables are further clustered into major categories from information processing research: input, process, and output. The main variables investigated are the characteristics of the information set, especially the number of information cues as an input variable; the experience of the decision-maker, the decision time, decision rule, and cue usage as process variables; and measures related to decision quality (i.e., accuracy, consensus, consistency) and related to selfinsight (calibration, confidence, feeling of overload) as output variables. The contexts of the respective research papers are described, and the operationalization of variables detailed and compared. We employ the method of stylized facts to evaluate the strength of the links between variables (number of links, direction and significance of relationship). The findings can be summarized as follows: most articles focus on individual decision-making in the domain of external accounting, with financial distress predictions constituting a large part of these. Most papers focus on input and output variables with the underlying information processing receiving less attention. The effects observed are dependent on the type of information input and the task employed. Decision accuracy is likely to decrease once information load passes a certain threshold, while decision time and a feeling of overload increase with increasing information load. While experience increases decision accuracy, the results on decision time and consensus are conflicting. Most articles have not established a significant link between changes in information load and changes in decision confidence. Relative cue usage, consensus, consistency, and calibration decline with increasing information load. Available time has a rather positive effect on decision accuracy and consensus. Based on these findings, implications for practice and future research are derived.

show abstract

The effect of environmental credit rating on audit fees: A quasi-natural experiment from China

Wang,

Zhong,

2024

Heliyon

View full text Add to dashboard Cite

Management earnings forecasts disaggregation and audit fees: International evidence

Cited by 8 publications

References 75 publications

Media coverage of corporate social irresponsibility and audit fees: International evidence

Media coverage of corporate social irresponsibility and audit fees: International evidence

Information overload research in accounting: a systematic review of the literature

The effect of environmental credit rating on audit fees: A quasi-natural experiment from China

Contact Info

Product

Resources

About