Institutional Ownership and the Selection of Industry Specialist Auditors

Institutional Ownership and the Selection of Industry Specialist Auditors This study provides evidence linking corporate governance mechanisms to the choice of auditor, namely industry specialists. Given that institutional investors are likely to prefer higher quality financial reports to lower quality reports, we theorize that institutional investors will influence managers of companies in which they invest to improve reporting quality by using higher quality, industry specialist auditors. Our findings indicate that firms having relatively greater levels of institutional ownership tend to employ industry specialist audit firms. The results of this study contribute to an understanding of an important facet of corporate governance, the selection of a high quality audit firm. Review of Quantitative Finance and Accounting Springer Journals

Institutional Ownership and the Selection of Industry Specialist Auditors

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Kluwer Academic Publishers
Copyright © 2003 by Kluwer Academic Publishers
Finance; Corporate Finance; Accounting/Auditing; Econometrics; Operation Research/Decision Theory
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  • Auditor Brand Name Reputations and Industry Specializations
    Craswell, A. T.; Francis, J. R.; Taylor, S. L.

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