State ownership, the institutional environment, and auditor choice: Evidence from China

Qian Wang, T.J. Wong and Lijun Xia

Journal of Accounting and Economics, 2008, vol. 46, issue 1, pages 112-134

Abstract: This paper finds that compared with non-state-owned firms, Chinese state-owned enterprises controlled by province, city, and county governments (local SOEs) are more likely to hire small auditors within the same region (small local auditors). In regions with less developed institutions, SOEs controlled by central government (central SOEs) also have such a tendency. However, the tendency of local and central SOEs to hire small local auditors is attenuated as the institutions develop. This auditor choice pattern is likely to be explained by SOEs' lack of demand for large or non-local auditors, small local auditors' superior local knowledge, and SOEs' collusion incentives.

Keywords: Auditor; choice; State; ownership; Institutions; Corporate; governance; Transition; economies (search for similar items in EconPapers)
Date: 2008

Downloads: (external link)
http://www.sciencedirect.com/science/article/B6V87 ... f3c4bd928610d8d2f02a
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eee:jaecon:v:46:y:2008:i:1:p:112-134

Access Statistics for this article

Journal of Accounting and Economics is edited by J. L. Zimmerman, S. P. Kothari, T. Z. Lys and R. L. Watts

More articles in Journal of Accounting and Economics from Elsevier
Series data maintained by Heidi Boesdal ().