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Open Access
Article
Publication date: 19 September 2018

Mohammad Mohammadi, Behzad Kardan and Mahdi Salehi

The purpose of this paper is to investigate the relationship between cash holdings, investment opportunities and financial constraint with audit fees in Iran.

6103

Abstract

Purpose

The purpose of this paper is to investigate the relationship between cash holdings, investment opportunities and financial constraint with audit fees in Iran.

Design/methodology/approach

In order to collect data, all manufacturing companies listed on the Tehran Stock Exchange are used to test the hypotheses during 2008–2015. Panel data and combined data regression model were used for data analysis. Tests were performed using R statistical software.

Findings

The results obtained from the statistical analysis of research hypotheses indicated that there is a significant relationship between cash holdings and audit fees. Furthermore, the relationship between cash holdings, financial constraints and audit fees was significant. In addition, there was no significant relationship between cash holdings, investment opportunities and audit fees.

Originality/value

The current study employed a unique topic in terms of a developing country, and the results may give strength to other developing nations.

Details

Asian Journal of Accounting Research, vol. 3 no. 1
Type: Research Article
ISSN: 2443-4175

Keywords

Open Access
Article
Publication date: 14 December 2022

Mahdi Salehi, Tamanna Dalwai and Arash Arianpoor

The present study aims to assess the impact of narcissism, self-confidence and auditor's characteristics on audit report readability for companies listed on the Tehran Stock…

2022

Abstract

Purpose

The present study aims to assess the impact of narcissism, self-confidence and auditor's characteristics on audit report readability for companies listed on the Tehran Stock Exchange.

Design/methodology/approach

The study’s statistical population comprises firms listed on the Tehran Stock Exchange. The present research used a systematic elimination method, and 1,162 firm-year observations were obtained for seven years from 2012 to 2018. Three variables including auditor tenure, audit fee and audit specialization are used for measuring auditing features. The Fog index is used as a proxy for measuring audit report readability. In addition, in this paper, four regressions, including fixed effects, random effects, pooled and T+1, are used to estimate reliable coefficients.

Findings

The findings show a negative and significant relationship between auditor’s characteristics (tenure, fee and specialization) and audit report readability. Moreover, the variables of the auditor’s narcissism, self-confidence and mandatory auditor change have a positive and significant association with audit report readability. This study lends support to the theories of personality disorder and behavioral decision.

Originality/value

Since narcissism and self-confidence are two characteristics that shape an individual’s character and personality, some involved behavioral factors in auditors’ characteristics contribute to their decisions. The effects of these should be detected to enhance the decision-making process. The said factors significantly impact audit report readability. Hence, this paper attempts to assess the effect of the said factors on audit report readability.

Details

Arab Gulf Journal of Scientific Research, vol. 41 no. 2
Type: Research Article
ISSN: 1985-9899

Keywords

Open Access
Article
Publication date: 4 December 2017

Azam Eshagniya and Mahdi Salehi

This paper aims to examine the effect of financial restatement on changing the auditor in the following years.

5208

Abstract

Purpose

This paper aims to examine the effect of financial restatement on changing the auditor in the following years.

Design/methodology/approach

The study uses data of 105 companies (735 company-years) listed on the Tehran Stock Exchange collected during the period 2008-2014. Logistic regression is used to test the hypotheses.

Findings

The results of hypotheses present that restatement does not cause auditor changes and that as the severity of a restatement increases, the auditor change in the following year of restatement also does not increase. Restating companies having strong governance do not go for auditor changes as compared with other companies. In addition, in companies that are restating, non-big auditor changes are not more likely than a big auditor. Also, in companies restating simultaneous with a CEO turnover, there is no possibility of auditor change. Furthermore, multinomial logistic regression showed that the adjustments resulting from the correction of errors and changes in procedures and the amount of adjustments do not cause auditor change in the following year. So, the results have shown that the restatement is not an important factor in changing auditor the next year.

Originality/value

The current study analyses the impact of financial restatement on auditor changes in a deep manner in a developing country like Iran.

Details

Asia Pacific Journal of Innovation and Entrepreneurship, vol. 11 no. 3
Type: Research Article
ISSN: 2071-1395

Keywords

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