Auditors’ Religious Beliefs and Audit Quality: Some Evidence from Taiwan

IF 2 Q2 BUSINESS, FINANCE International Journal of Accounting Pub Date : 2022-07-21 DOI:10.1142/s1094406022500135
Rong-Ruey Duh, F. Gul, A. Hsu
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引用次数: 1

Abstract

Synopsis The research problem Adding to the literature in auditing, this study examines whether there is an association between the religious beliefs of audit partners and audit quality in Taiwan. Motivation Previous studies have found that firms headquartered in areas with strong religious social norms are associated with higher audit quality. However, prior studies measured religiosity in terms of whether the audit practice offices were in more religious metropolitan statistical areas. No work had examined whether the religious beliefs of the individual auditors affect auditor decision making. In addition, prior studies using US data were mainly confined to one group who are, in the main, Christians. We examined this issue in Taiwan where the auditors come from three main religious groups: Christian, Buddhist, and Taoist. This setting provides another cultural environment for understanding the links between religiosity and financial reporting issues. The test hypotheses [Formula: see text]: Audit engagement partners with a religious belief are associated with higher audit quality. [Formula: see text]: The positive association between auditors’ religion and audit quality is more pronounced for auditors with industry specialization than auditors without specialization. Target population Various stakeholders include investors, auditors, financial analysts, and users of financial reports. Adopted methodology Ordinary least squares (OLS) regression and logistics regression. Analyses We conducted the study in Taiwan where audit partners are required to sign audit reports. We obtained data on the religious beliefs of auditors by distributing a questionnaire to individual auditors in the Big 4 in Taiwan. We used four measures of audit quality: (a) discretionary accruals, (b) accrual estimation errors, (c) the probability of a client meeting an earnings benchmark, and (d) the propensity to issue modified audit opinions. We tested whether there is a positive association between auditors’ religious beliefs and audit quality. Findings Our study finds that firms with an audit partner who professes a religion are associated with higher audit quality. However, unlike evidence from the United States, we do not find that auditors in an area with strong religious social norms exhibit better audit quality than auditors in less religious areas when the audit partner’s religious belief is controlled in the analysis. The results suggest that auditor quality is more affected by auditor’s personal characteristics than the social norms. We also find that the positive association between auditors with industry specialization and audit quality is stronger when the auditor has religious beliefs. The results suggest that ethics and competence are complements to each other.
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审计人员的宗教信仰与审计质量:来自台湾的证据
本研究结合审计文献,探讨台湾地区审计合伙人的宗教信仰与审计质量之间是否存在关联。先前的研究发现,总部设在宗教社会规范强烈的地区的公司与更高的审计质量相关。然而,先前的研究是根据审计实践办公室是否在宗教信仰较多的大都市统计地区来衡量宗教虔诚度的。没有研究审查个别审计员的宗教信仰是否影响审计员的决策。此外,先前使用美国数据的研究主要局限于一个主要是基督徒的群体。我们在台湾研究了这个问题,那里的审计员来自三个主要的宗教团体:基督教、佛教和道教。这种背景为理解宗教信仰与财务报告问题之间的联系提供了另一种文化环境。检验假设[公式:见文本]:具有宗教信仰的审计业务合伙人与较高的审计质量相关。[公式:见文本]:具有行业专业化的审计师的宗教信仰与审计质量之间的正相关关系比不具有行业专业化的审计师更为明显。不同的利益相关者包括投资者、审计师、财务分析师和财务报告的使用者。采用普通最小二乘(OLS)回归和logistic回归。我们在台湾进行研究,台湾要求审计合伙人签署审计报告。通过对台湾四大会计师事务所的个别审计师进行问卷调查,我们获得了审计师的宗教信仰数据。我们使用了四种审计质量衡量标准:(a)可自由支配的应计项目,(b)应计项目估计误差,(c)客户达到盈利基准的可能性,以及(d)发布修改审计意见的倾向。我们检验了审计师的宗教信仰与审计质量之间是否存在正相关关系。我们的研究发现,拥有宗教信仰的审计合伙人的公司审计质量更高。然而,与美国的证据不同,在分析中,当审计伙伴的宗教信仰受到控制时,我们没有发现宗教社会规范强烈地区的审计员比宗教信仰较少地区的审计员表现出更好的审计质量。结果表明,审计师个人特征对审计质量的影响大于社会规范。我们还发现,当审计师有宗教信仰时,审计师与行业专业化和审计质量之间的正相关关系更强。结果表明,道德与胜任力是相辅相成的。
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来源期刊
CiteScore
1.20
自引率
0.00%
发文量
19
期刊介绍: The aim of The International Journal of Accounting is to advance the academic and professional understanding of accounting theory, policies and practice from the international perspective and viewpoint. The Journal editorial recognizes that international accounting is influenced by a variety of forces, e.g., governmental, political and economic. Thus, the primary criterion for manuscript evaluation is the incremental contribution to international accounting literature and the forces that impact the field. The Journal aims at understanding the present and potential ability of accounting to aid in analyzing and interpreting international economic transactions and the economic consequences of such reporting. These transactions may be within a profit or non-profit environment. The Journal encourages a broad view of the origins and development of accounting with an emphasis on its functions in an increasingly interdependent global economy. The Journal also welcomes manuscripts that help explain current international accounting practices, with related theoretical justifications, and identify criticisms of current policies and practice. Other than occasional commissioned papers or special issues, all the manuscripts published in the Journal are selected by the editors after the normal double-blind refereeing process.
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