Auditor human capital and financial misstatement: Evidence from China

Abbott, 2004, Audit committee characteristics and restatements, Auditing: J. Practice Theory, 23, 69, 10.2308/aud.2004.23.1.69 Agrawal, 2005, Corporate governance and accounting scandals, J. Law Econ., 48, 371, 10.1086/430808 Allen, 2005, Law, finance, and economic growth in China, J. Financial Econ., 77, 57, 10.1016/j.jfineco.2004.06.010 Alleyne, 2013, The effectiveness of corporate culture, auditor education, and legislation in identifying, preventing, and eliminating corporate fraud, Int. J. Bus., Account., Finance, 7, 34 Aobdia, 2015, Capital market consequences of audit partner quality, Account. Rev., 90, 2143, 10.2308/accr-51054 Ashton, 1991, Experience and error frequency knowledge as potential determinants of audit expertise, Account. Rev., 66, 218 Banks, J., Mazzonna, F., 2011. The effect of childhood education on old age cognitive abilities: evidence from a regression discontinuity design. Institute for Fiscal Studies Working Paper. Bantel, 1989, Top management and innovations in banking: does the composition of the top team make a difference?, Strategic Manage. J., 10, 107, 10.1002/smj.4250100709 Barker, 2002, CEO characteristics and firm R&D spending, Manage. Sci., 48, 782, 10.1287/mnsc.48.6.782.187 Basmann, 1960, On finite sample distributions of generalized classical linear identifiability test statistics, J. Am. Stat. Assoc., 55, 650, 10.1080/01621459.1960.10483365 Becker, 1998, The effect of audit quality on earnings management, Contemp. Account. Res., 15, 1, 10.1111/j.1911-3846.1998.tb00547.x Becker, 1962, Investment in human capital: a theoretical analysis, J. Political Econ., 70, 9, 10.1086/258724 Benhabib, 1994, The role of human capital in economic development evidence from aggregate cross-country data, J. Monetary Econ., 34, 143, 10.1016/0304-3932(94)90047-7 Bernardi, 1994, Fraud detection: the effect of client integrity and competence and auditor cognitive style, Auditing: J. Practice Theory, 13, 68 Bonner, 1990, Experience effects in auditing: the role of task-specific knowledge, Account. Rev., 65, 72 Bonner, 1990, Determinants of auditor expertise, J. Account. Res., 28, 1, 10.2307/2491243 Bröcheler, 2004, Auditor human capital and audit firm survival: the Dutch audit industry in 1930–1992, Account., Org. Soc., 29, 627, 10.1016/j.aos.2003.10.008 Brown, 2009, Resolving disputed financial reporting issues: effects of auditor negotiation experience and engagement risk on negotiation process and outcome, Auditing: J. Practice Theory, 28, 65, 10.2308/aud.2009.28.2.65 Cacioppe, 2008, A survey of managers’ perceptions of corporate ethics and social responsibility and actions that may affect companies’ success, J. Bus. Ethics, 82, 681, 10.1007/s10551-007-9586-y Cahan, 2015, The effect of audit experience on audit fees and audit quality, J. Account., Audit. Finance, 30, 78, 10.1177/0148558X14544503 Carcello, 2013, Costs and benefits of requiring an engagement partner signature: recent experience in the United Kingdom, Account. Rev., 88, 1511, 10.2308/accr-50450 Carey, 2006, Audit partner tenure and audit quality, Account. Rev., 81, 653, 10.2308/accr.2006.81.3.653 Caskey, 2013, Dividend policy at firms accused of accounting fraud, Contemp. Account. Res., 30, 818, 10.1111/j.1911-3846.2012.01173.x Chang, 2011, Productivity growth in the public accounting industry: the roles of information technology and human capital, Auditing: J. Practice Theory, 30, 21, 10.2308/aud.2011.30.1.21 Chen, 2008, Audit partner tenure, audit firm tenure, and discretionary accruals: does long auditor tenure impair earnings quality?, Contemp. Account. Res., 25, 415, 10.1506/car.25.2.5 Chen, 2016, Do audit clients successfully engage in opinion shopping? Partner-level evidence, J. Account. Res., 54, 79, 10.1111/1475-679X.12097 Chen, 2010, Client importance, institutional improvements, and audit quality in China: an office and individual auditor level analysis, Account. Rev., 85, 127, 10.2308/accr.2010.85.1.127 Chen, 2008, The association between continuing professional education and financial performance of public accounting firms, Int. J. Human Resour. Manage., 19, 1720, 10.1080/09585190802295363 Cheng, 2009, The association between auditor quality and human capital, Manage. Auditing J., 24, 523, 10.1108/02686900910966512 Chi, 2011, Firm versus partner measures of auditor industry expertise and effects on auditor quality, Auditing: J. Practice Theory, 30, 201, 10.2308/ajpt-50004 Chi, 2012, Client importance and audit partner independence, J. Account. Public Policy, 31, 320, 10.1016/j.jaccpubpol.2011.08.009 Chin, 2009, Reducing restatements with increased industry expertise, Contemp. Account. Res., 26, 729, 10.1506/car.26.3.4 Choi, 2007, Auditors' governance functions and legal environments: an international investigation, Contemp. Account. Res., 24, 13, 10.1506/X478-1075-4PW5-1501 Christelis, 2010, Cognitive abilities and portfolio choice, Eur. Econ. Rev., 54, 18, 10.1016/j.euroecorev.2009.04.001 Davies, 2005, The channeling of student competition in higher education: comparing Canada and the US, J. Higher Educat., 76, 89, 10.1353/jhe.2005.0003 DeAngelo, 1981, Auditor size and audit quality, J. Account. Econ., 3, 183, 10.1016/0165-4101(81)90002-1 Dechow, 2011, Predicting material accounting misstatements, Contemp. Account. Res., 28, 17, 10.1111/j.1911-3846.2010.01041.x DeFond, 2014, A review of archival auditing research, J. Account. Econ., 58, 275, 10.1016/j.jacceco.2014.09.002 Deshpande, 1997, Managers' perception of proper ethical conduct: the effect of sex, age, and level of education, J. Bus. Ethics, 16, 79, 10.1023/A:1017917420433 Dohmen, 2010, Are risk aversion and impatience related to cognitive ability?, Am. Econ. Rev., 100, 1238, 10.1257/aer.100.3.1238 Du, 2015, Does Confucianism reduce minority shareholder expropriation? Evidence from China, J. Bus. Ethics, 132, 661, 10.1007/s10551-014-2325-2 Du, 2015, Financial distress, investment opportunity, and the contagion effect of low audit quality: evidence from China, J. Bus. Ethics Farber, 2005, Restoring trust after fraud: does corporate governance matter?, Account. Rev., 80, 539, 10.2308/accr.2005.80.2.539 Ferguson, 2000, Audit education and training: the effect of formal studies and work experience, Account. Horizons, 14, 137, 10.2308/acch.2000.14.2.137 Finkelstein, 1992, Power in top management teams: dimensions, measurement, and validation, Acad. Manage. J., 35, 505, 10.2307/256485 Francis, 2013, Office size of Big 4 auditors and client restatements, Contemp. Account. Res., 30, 1626, 10.1111/1911-3846.12011 Goodwin, 2014, Is the effect of industry expertise on audit pricing an office-level or a partner-level phenomenon?, Rev. Account. Stud., 19, 1532, 10.1007/s11142-014-9285-8 Guan, 2016, Do school ties between auditors and client executives influence audit outcomes?, J. Account. Econ., 61, 506, 10.1016/j.jacceco.2015.09.003 Gul, 2013, Do individual auditors affect audit quality? Evidence from archival data, Account. Rev., 88, 1993, 10.2308/accr-50536 Hardies, 2016, Do (fe)male auditors impair audit quality? Evidence from going-concern opinions, Eur. Account. Rev., 25, 7, 10.1080/09638180.2014.921445 Hitt, 2001, Direct and moderating effects of human capital on strategy and performance in professional service firms: a resource-based perspective, Acad. Manage. J., 44, 13, 10.2307/3069334 Islam, 1995, Growth empirics: a panel data approach, Quart. J. Econ., 110, 1127, 10.2307/2946651 Ittonen, 2015, Audit partner public-client specialisation and client abnormal accruals, Eur. Account. Rev., 24, 607, 10.1080/09638180.2014.906315 Ittonen, 2013, Female auditors and accruals quality, Account. Horizons, 27, 205, 10.2308/acch-50400 Jiang, 2010, Tunneling through intercorporate loans: the China experience, J. Financial Econ., 98, 1, 10.1016/j.jfineco.2010.05.002 Kallunki, J.P., Niemi, L., Nilsson, H., 2016. Do smarter auditors deliver better audit quality? Archival evidence based on unique IQ data on Swedish auditors. https://doi.org/10.2139/ssrn.2604948. Kang, 2016, The association between human resource investment by audit firms and their audit quality, Asia-Pacific J. Account. Econ., 24, 1 Kaplan, 2008, The influence of auditor experience on the persuasiveness of information provided by management, Auditing: J. Practice Theory, 27, 67, 10.2308/aud.2008.27.1.67 Libby, 1985, Availability and the generation of hypotheses in analytical review, J. Account. Res., 23, 648, 10.2307/2490831 Libby, 1990, Experience and the ability to explain audit findings, J. Account. Res., 28, 348, 10.2307/2491154 Lichtenstein, 1977, Do those who know more also know more about how much they know?, Org. Behav. Human Perform., 20, 159, 10.1016/0030-5073(77)90001-0 Lobo, 2013, Relation between audit effort and financial report misstatements: evidence from quarterly and annual restatements, Account. Rev., 88, 1385, 10.2308/accr-50440 Lucas, 1988, On the mechanics of economic development, J. Monetary Econ., 22, 3, 10.1016/0304-3932(88)90168-7 Mankiw, 1992, A contribution to the empirics of economic growth, Quart. J. Econ., 107, 407, 10.2307/2118477 Mincer, 1962, On-the-job training: costs, returns, and some implications, J. Political Econ., 70, 50, 10.1086/258725 Moroney, 2011, Industry-versus task-based experience and auditor performance, Auditing: J. Practice Theory, 30, 1, 10.2308/ajpt-10060 Nelson, 2009, A model and literature review of professional skepticism in auditing, Auditing: J. Practice Theory, 28, 1, 10.2308/aud.2009.28.2.1 Omer, T.C., Sharp, N.Y., Wang, D., 2010. Do local religious norms affect auditors going concern decisions. https://doi.org/10.2139/ssrn.1664727. Pennings, 1998, Human capital, social capital, and firm dissolution, Acad. Manage. J., 41, 425, 10.2307/257082 Petersen, 2009, Estimating standard errors in finance panel data sets: comparing approaches, Rev. Financial Stud., 22, 435, 10.1093/rfs/hhn053 Ponemon, 1993 Ponemon, 1993, The influence of ethical reasoning on auditors’ perception of management’s integrity and competence, Adv. Account., 11, 1 Rest, 1985, Relation of moral judgment development to formal education, Develop. Psychol., 21, 709, 10.1037/0012-1649.21.4.709 Rice, 2012, How effective is internal control reporting under SOX 404? Determinants of the (non-) disclosure of existing material weaknesses?, J. Account. Res., 50, 811, 10.1111/j.1475-679X.2011.00434.x Romer, 1990, Endogenous technological change, J. Political Econ., 98, 71, 10.1086/261725 Samagaio, 2016, Human capital and performance in young audit firms, J. Bus. Res., 69, 5354, 10.1016/j.jbusres.2016.04.137 Sargan, 1958, The estimation of economic relationships using instrumental variables, Economet.: J. Econ. Soc., 26, 393, 10.2307/1907619 Schultz, 1960, Capital formation by education, J. Political Econ., 68, 571, 10.1086/258393 Schultz, 1961, Investment in human capital, Am. Econ. Rev., 51, 1 Shelton, 1999, The effect of experience on the use of irrelevant evidence in auditor judgment, Account. Rev., 74, 217, 10.2308/accr.1999.74.2.217 Shleifer, 2004, Does competition destroy ethical behavior?, Am. Econ. Rev., 94, 414, 10.1257/0002828041301498 Sonu, 2016, Audit partner’s length of audit experience and audit quality: evidence from Korea, Asia-Pacific J. Account. Econ. Sundgren, 2014, Auditor-in-charge characteristics and going-concern reporting, Contemp. Account. Res., 31, 531, 10.1111/1911-3846.12035 Sweeney, 1997, Cognitive moral development and auditor independence, Account., Org. Soc., 22, 337, 10.1016/S0361-3682(96)00025-6 Tihanyi, 2000, Composition of the top management team and firm international diversification, J. Manage., 26, 1157 Tubbs, 1992, The effect of experience on the auditor's organization and amount of knowledge, Account. Rev., 67, 783 Tyler, 1998, The effects of executives’ experiences and perceptions on their assessment of potential technological alliances, Strategic Manage. J., 19, 939, 10.1002/(SICI)1097-0266(199810)19:10<939::AID-SMJ978>3.0.CO;2-Z Wally, 1994, Personal and structural determinants of the pace of strategic decision making, Acad. Manage. J., 37, 932, 10.2307/256605 Wang, 2015, Engagement audit partner experience and audit quality, China J. Account. Stud., 3, 230, 10.1080/21697213.2015.1055776 Wang, 2008, State ownership, the institutional environment, and auditor choice: evidence from China, J. Account. Econ., 46, 112, 10.1016/j.jacceco.2008.04.001 Wang, 2011, The quality of financial reporting in China: an examination from an accounting restatement perspective, China J. Account. Res., 4, 167, 10.1016/j.cjar.2011.09.001 Wiersema, 1992, Top management team demography and corporate strategic change, Acad. Manage. J., 35, 91, 10.2307/256474 Wooldridge, 1995, Score diagnostics for linear models estimated by two stage least squares, 66 Wright, 2001, Task experience as a predictor of superior loan loss judgments, Auditing: J. Practice Theory, 20, 147, 10.2308/aud.2001.20.1.147 Wu, 2009, Do audit firms assign the more experienced engagement partners to new clients switching from other firms?, China Account. Finance Rev., 11, 29 Xin, 1996, Guanxi: connections as substitutes for formal institutional support, Acad. Manage. J., 39, 1641, 10.2307/257072 Yang, 2013, Do political connections add value to audit firms? Evidence from IPO audits in China, Contemp. Account. Res., 30, 891, 10.1111/j.1911-3846.2012.01177.x Yu, 2008, Analyst coverage and earnings management, J. Financial Econ., 88, 245, 10.1016/j.jfineco.2007.05.008 Yuan, 2012, Individual auditor’s characteristics and audit quality, China Account. Rev., 10, 275 Zerni, 2012, Audit partner specialization and audit fees: some evidence from Sweden, Contemp. Account. Res., 29, 312, 10.1111/j.1911-3846.2011.01098.x Zhang, 2013, Building global-class universities: assessing the impact of the 985 Project, Res. Policy, 42, 765, 10.1016/j.respol.2012.10.003