Signing auditors’ foreign experience and audit pricing

Fei Hou, Jie Liu, Tingyun Pang and Hao Xiong

Economic Modelling, 2020, vol. 91, issue C, 300-312

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.

Keywords: Signing auditors; Foreign education experience; Audit firm size; Audit pricing (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:91:y:2020:i:c:p:300-312

DOI: 10.1016/j.econmod.2020.06.014

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