The Effect of Social Capital on Auditor’s Performance

Maryamalsadat Mousavi Azghandi, Sahar Jabbari (), Hossien Rezaei Ranjbar and Ahmed Al-janabi
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Maryamalsadat Mousavi Azghandi: Department of Economics and Administrative Sciences, Imammareza International University of Mashhad, Mashhad 9177948974, Iran
Sahar Jabbari: Department of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad 9177948974, Iran
Hossien Rezaei Ranjbar: Department of Economics and Administrative Sciences, Qaenat Branch, Islamic Azad University, Qaenat 9147921074, Iran
Ahmed Al-janabi: Department of Economics and Administrative Sciences, Ferdowsi University of Mashhad, Mashhad 9177948974, Iran

JRFM, 2023, vol. 16, issue 2, 1-22

Abstract: This paper investigates the relationship between social capital and auditor’s performance in Iranian listed firms. The sample included 128 firms on the Tehran Stock Exchange from 2014 to 2020. The research method was descriptive-correlational, and the relationship between research variables was explained using regression models based on the panel data. The results illustrated that social capital positively correlates with auditor performance and Audit report quality. In other words, social capital decreases audit opinion shopping, audit expectation gap, internal control weakness, and audit report lag. Therefore, society’s influential assets, social capital, and audit report quality strongly influence the auditor’s performance. The auditor’s performance affects the probability of discovery and reporting material errors and misstatements. Therefore, recognizing influential factors on auditors’ performance can improve the quality of audit reports.

Keywords: audit performance; audit opinion shopping; audit expectation gap; internal control weakness; audit report lag; social capital; audit report quality (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2023
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