External auditor is an independent agent to provide assurance about the validity of financial statements prepared by management to enhance the reliability of information in financial reports. As such, audit quality has long been a concern for all stakeholders and is a topic of on-going research interest. In China, the dual audit requirement for AB share companies and AH share companies started in 2001 was abolished in 2007 and 2010 respectively. This study attempts to examine whether there are dual audit effect and contagious effect on the audit quality of non-Big N audit firms for A share companies in different markets. I focus on non-Big N audit firms since the audit quality of these firms are of greater concern. Using data from 2001 to 2012, I compare the audit quality of A share companies that also have B (or H) shares ((AB/H) with the audit quality of pure A share companies to test whether there is a dual audit effect on the audit quality of A-share financial statements. I also compare AB/H share companies which hire only non-Big N auditors with those ABIH share companies who hire non-Big N domestic auditors and Big N international auditors to test the existence of contagious effect on the audit quality of A-share companies. My findings indicate that dual audit does improve the audit quality of non-Big N audit firms for A share companies. However, there was mixed evidences on the contagious effect using different measures of audit quality. This study contributes to the literature on enhancing our understanding of the determinants of audit quality in China. It can also provide policy makers in emerging economies some useful evidence on ways to improve audit quality.
| Identifer | oai:union.ndltd.org:ln.edu.hk/oai:commons.ln.edu.hk:acct_etd-1018 |
| Date | 28 July 2014 |
| Creators | WANG, Meixin |
| Publisher | Digital Commons @ Lingnan University |
| Source Sets | Lingnan University |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | Theses & Dissertations |
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