The Impact of Employee Education Levels on Auditors’ Risk-Related decision-Making: Evidence from Listed Companies in China

Caijie Zhu, Wanning Dou and Wenfei Qie

Emerging Markets Finance and Trade, 2025, vol. 61, issue 14, 4445-4461

Abstract: The value of highly educated employees is increasingly recognized, as their ability to optimize information processing and external signal transmission may influence auditors’ risk-related decision-making. This study examines the impact of employee education levels on auditors’ risk assessments using data from A-share listed companies in Shanghai and Shenzhen Stock Exchanges from 2013 to 2022. It further explores the moderating role of internal control effectiveness in this relationship. The findings indicate that lower employee education levels are associated with higher audit costs, nonstandard audit opinions, and changes in audit relationships—suggesting these as auditors’ preferred risk-mitigation measures. Moreover, strong internal controls positively moderate the relationship between employee education levels and auditors’ risk-related decision-making.

Date: 2025
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DOI: 10.1080/1540496X.2025.2514675

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