دانلود رایگان مقاله انگلیسی انتخاب حسابرسان در شرکت های خصوصی: دیدگاه سهامداران - امرالد 2018

Abstract

Purpose – This paper aims to examine whether a private firm’s demand for a Big4 auditor is influenced by the auditor choice of its main supplier, customer and competitor. The authors rely on institutional theory to explain this stakeholders’ influence. The authors also examine whether the extent to which the firm’s board of directors engages in networking moderates this influence. Design/methodology/approach – Questionnaire data are combined with archival data of 210 Belgian private firms with a statutory audit requirement. Logistic regression analysis is applied to examine to what extent firms follow their main competitor, customer and supplier in hiring a Big4 auditor. Findings – The results reveal a positive association between the firm’s choice of a Big4 auditor and its main supplier being audited by a Big4 auditor, supporting the conformance effect (isomorphism) toward suppliers as hypothesized by institutional theory. The extent of board networking, however, seems to weaken this effect. Toward competitors, a divergence effect instead of a conformance effect is found, which indicates the existence of competitive differentiation regarding auditor choice. Research limitations/implications – While prior studies mainly focus on the agency relationships between shareholders, debtholders and managers to explain auditor choice, this study also takes into account the firm’s other main stakeholders by relying on institutional theory. Both the conformance effect toward suppliers as well as the divergence effect toward competitors provide interesting additional perspectives on why auditors are demanded, leading to interesting future research opportunities. Originality/value – This paper fulfills an identified need to consider additional theories in explaining audit outcomes.

5. Conclusions

In this study, we examined the influence of a firm’s main competitor, customer and supplier on the choice for a Big4 auditor. While most auditor choice studies keep relying exclusively on the agency theory to explain this choice, we provide an additional perspective to the extant literature by examining auditor choice from an institutional theory view. The institutional theory states that firms may become very similar to one another as a response to uncertainty, pressures from stakeholders, external expectations, etc. (DiMaggio and Powell, 1983), which is called institutional isomorphism. Therefore, the choice of a Big4 auditor may be a response to one of their main stakeholders hiring a Big4 auditor, irrespective of the level of agency conflicts, because this is considered to be good practice and might therefore increase the firm’s overall legitimacy. Han (1994) already examined isomorphism toward competitors regarding auditor choice in a listed firm context and found that listed firms often imitate the leader of an industry by choosing the same auditor. We add to this study in two ways. In the first place, we examined whether isomorphism may also explain auditor choice in private firms. Second, while Han (1994) only focused on isomorphism toward competitors, we also examined isomorphic behavior toward suppliers and customers.