In May 2022, The thesis "Does CEO - Auditor Dialect Connectedness Trigger Audit Opinion Shopping? Evidence from China" was written by Xiao Liang (second author), Supervisor Professor Du Xingqiang (first author) and one other collaborator. is published online in the FT50 Journal of Business Ethics.
“Does CEO–Auditor Dialect Connectedness Trigger Audit Opinion Shopping? Evidence from China” Using the original ID information of ceos and signing auditors, manually collected CEO-auditor dialect connectedness (CADC) data, examined the influence of CADC on audit opinion buying (AOS), and further explored the moderating role of auditor reputation. Taking Chinese listed companies from 2007 to 2019 as a sample, the study shows that companies with CEO-auditor dialect connectedness are significantly more likely to have audit opinion buying than companies without such connectedness, revealing that CEO-auditor dialect connectedness harms auditor independence and induces audit opinion buying. In addition, CADC's influence on AOS is more pronounced in non-BIG10 audited firms than in BIG10 audited firms, meaning that auditor reputation weakens the relationship between CADC and AOS. These findings remain robust after substituting different CADC and AOS measures, and hold true after controlling for endogeneity using Heckman two-stage regression, propensity score matching (PSM), differential regression model, and breakpoint regression (RDD) methods. Finally, the CADC's influence on AOS is only established among field auditors. In general, this study adds to the existing literature on opinion buying and auditor independence.
Xiao Liang is a 2018 PhD candidate in the Department of Accounting, School of Management, Xiamen University. His supervisor is Professor Du Xingqiang. His research field is capital market accounting and auditing. He has published two papers in the Journal of Business Ethics, participated in the research of major projects of the National Social Science Foundation and the National Natural Science Foundation, and participated in the compilation of a book.
