Journal article
Market Competition, Audit Fee Stickiness, and Audit Quality: Evidence from China
Auditing : a journal of practice and theory, v 38(2), pp 79-99
01 May 2019
Abstract
This study examines how audit fee stickiness varies with changes in market competition in China and its effect on audit quality. The Chinese audit market structure has changed significantly since the Chinese Institute of Certified Public Accountants (CICPA) issued a proposal to enhance the competitiveness of large domestic audit firms by promoting the consolidation of domestic audit firms in 2007. Using a sample of Chinese listed firms, we find a decrease in upward stickiness and an increase in downward stickiness as market concentration increases in the post-Proposal period. The asymmetry between upward and downward fee stickiness is greater in local markets that are more dominated by the top 10 domestic auditors. Moreover, we find that upward (downward) fee stickiness has a negative (positive) association with audit quality as measured by earnings management and auditor reporting conservatism.
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Details
- Title
- Market Competition, Audit Fee Stickiness, and Audit Quality: Evidence from China
- Creators
- Hsihui Chang - Drexel UniversityYingwen Guo - Nanjing UniversityPhyllis Lai Lan Mo - City University of Hong Kong
- Publication Details
- Auditing : a journal of practice and theory, v 38(2), pp 79-99
- Publisher
- Amer Accounting Assoc
- Number of pages
- 21
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Accounting
- Web of Science ID
- WOS:000473252300004
- Scopus ID
- 2-s2.0-85070097138
- Other Identifier
- 991019168307404721
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- International collaboration
- Web of Science research areas
- Business, Finance