The relationship between audit components and audit expectation gap in listed companies on the Tehran stock exchange

2019 ◽  
Vol 18 (1) ◽  
pp. 199-222 ◽  
Author(s):  
Mahdi Salehi ◽  
Fariba Jahanbin ◽  
Mohammad Sadegh Adibian
Keyword(s):  
Regression Model ◽  
Multiple Regression ◽  
Stock Exchange ◽  
Audit Fees ◽  
Listed Companies ◽  
Multiple Regression Model ◽  
Content Type ◽  
Expectation Gap ◽  
Audit Firms ◽  
The Relationship

Purpose The expectation gap between auditors and users has recently been the topic of many controversies. This paper aims to evaluate the relationship between auditor’s characteristics and audit expectation gap among information users in listed companies on the Tehran stock exchange market. In other words, the study attempts to find whether there is a significant relationship between audit components and the audit expectation gap or not. Design/methodology/approach The multiple regression model is used to test the hypotheses. Research hypotheses are tested using a sample of 78 listed companies on the Tehran stock exchange during 2012-2016, by using integrated data technique of the multiple regression model. Findings The findings show that standard audit fees are not significantly associated with the audit expectation gap. Furthermore, audit fees are negatively associated with the audit expectation gap, which provides that allocated audit price in financial statements gives useful information for external and internal individuals. Predictably, it is recommended that audit opinion significantly determines the level of the audit expectation gap. The authors also find that the independence of the director boards and audit committee members fulfill the expectation gap of individual users. Moreover, finding the negative impact of audit firms ranking on the expectation gap, supports the idea of higher ranked audit firms provide high quality services, and consequently, more reliable information. Finally, the results show that the audit record is positively associated with the audit expectation gap. Originality/value As all recent studies on the expectation gap were qualitative, the present study is the first paper, which measures the expectation gap quantitatively through the statistical method.

The relationship between auditor characteristics and fraud detection

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jalil Khaksar ◽  
Mahdi Salehi ◽  
Mahmoud Lari DashtBayaz
Keyword(s):  
Multiple Regression ◽  
Significant Relationship ◽  
Stock Exchange ◽  
Fraud Detection ◽  
Financial Statements ◽  
Audit Fees ◽  
Multiple Regression Model ◽  
Content Type ◽  
The Relationship ◽  
Auditor Characteristics

Purpose This paper aims to analyze the relationship between the following auditor's characteristics with detecting frauds in the listed companies on the Tehran Stock Exchange. Design/methodology/approach A multiple regression model is used to test the research hypothesis. The hypothesis was further tested with a sample of 187 companies listed on the Tehran Stock Exchange (1,309 observations) from 2012 to 2018 and by using multiple regression models based on panel data and the random-effects model. Findings The results suggest a positive and significant relationship between audit firms' size, auditor rotation, specialization in the industry, the audit market's focus, auditor's independence, audit report lag and renewal of financial statements with fraud detection. The results revealed a significant relationship between the period of auditor tenure, auditor's narcissism, audit fees and the type of auditors' opinion (un-qualified opinion) with fraud detection. Originality/value As the present study is a pioneer in examining this issue in the emerging markets, it provides users, analysts and legal entities with useful information about auditor characteristics that significantly affect the fraud detection of financial statements. The results mitigate the literature gap and improve knowledge in this area.

The relationship between intellectual capital and financial statements readability: the role of management characteristics

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mahdi Salehi ◽  
Hassan Mohammadzadeh Moghadam ◽  
Zohreh Hajiha
Keyword(s):  
Regression Model ◽  
Intellectual Capital ◽  
Fixed Effects ◽  
Stock Exchange ◽  
Hypothesis Test ◽  
Financial Statements ◽  
Multiple Regression Model ◽  
Content Type ◽  
The Relationship

Purpose The present study aims to investigate the relationship between intellectual capital and the readability of financial statements with the mediating role of management characteristics of companies listed on the Tehran Stock Exchange. In other words, this research tries to find the answer to whether intellectual capital can positively affect the readability of financial statements. Design/methodology/approach A multivariate regression model was used to test the hypotheses for this purpose. The research hypotheses were tested using a sample of 1,309 observations listed on the Tehran Stock Exchange from 2012 to 2018 and a multiple regression model based on panel data and fixed-effects models. Findings The results indicate that intellectual capital has a positive and significant relationship with the readability of financial statements, which means that with increasing intellectual capital in companies, financial statements’ readability also increases. Based on the hypothesis test results, it has been determined that narcissism, accrual and real earnings management have a negative effect on the relationship between intellectual capital and the readability of financial statements. Originality/value Since the present study examines such an issue in emerging markets, it provides users, analysts and legal entities with useful information about management’s inherent and acquired characteristics that significantly impact the purchase of audit opinion. This study’s results also contribute to developing science and knowledge in this field and close the literature gap.

Using trade show information to enhance company success: an empirical investigation

2012 ◽  
Vol 27 (5) ◽  
pp. 384-391 ◽  
Author(s):  
Harriette Bettis‐Outland ◽  
Wesley J. Johnston ◽  
R. Dale Wilson
Keyword(s):  
Regression Model ◽  
Multiple Regression ◽  
Information Acquisition ◽  
Value Of Information ◽  
Multiple Regression Model ◽  
Content Type ◽  
Independent Variables ◽  
Trade Show ◽  
Trade Shows ◽  
The Relationship

PurposeThis paper seeks to provide an exploratory empirical study of the variables that are part of the return on trade show information (RTSI) concept, which is based on the use and value of information gathered at a trade show.Design/methodology/approachThe research is designed to explore relationships and identify those variables that are a particularly important part of the RTSI concept. The paper provides an exploratory test of the relationship between a series of variables that are related to the value of information gathered at trade shows. Data were collected from trade show attendees approximately 60 days after the trade show. A multiple regression model was developed that explores the relationship between the dependent variable that focuses on information value and the independent variables on various aspects of information acquisition, information dissemination, and information use.FindingsThe final multiple regression model found a significant relationship for several variables and has an adjusted R2 value of 0.552. Four significant independent variables were identified – one each in the information use and the shared information categories and two in the information acquisition category. These findings present an interesting picture of how information is used within an organization after it is acquired at a trade show.Research limitations/implicationsThe research is limited by the multiple regression model used to explore the relationships in the data. Also, data from only one trade show were used in the model.Practical implicationsThis paper focuses on the intangible, longer‐term benefits as important considerations when determining the value of new trade show information to the firm. The evaluation of trade show information also should include these intangible benefits, such as improved interdepartmental relations or interactions as well as discussions with other trade show participants in finding new uses for information that impacts the company's future success, as well as shorter‐term benefits such as booth activity.Originality/valueThe paper offers a unique approach for determining the value of information acquired at trade shows. Though information gathering has been included as an outcome variable in previous trade show studies, no other research has studied the value of this new trade show information to the company.

The relationship between audit components and audit market adaptability

2020 ◽  
Vol 27 (3) ◽  
pp. 835-853
Author(s):  
Mahdi Salehi ◽  
Mahdi Saravani ◽  
Safoura Rouhi
Keyword(s):  
Significant Relationship ◽  
Stock Exchange ◽  
Audit Fees ◽  
Policy Makers ◽  
Statistical Population ◽  
Content Type ◽  
Listed Firms ◽  
Audit Market ◽  
Audit Firms ◽  
The Relationship

Purpose This study aims to study the relationship between audit components and collusion in the audit market. Design/methodology/approach The statistical population of the study includes 130 listed firms on the Tehran Stock Exchange from 2012-2017. The data tested using multivariate regression. Findings The findings of the study indicate that there is a positive and significant relationship between Rank A audit firms, competition and audit fees and audit market adaptability. The relationship standard fees and audit market adaptability, however, is negative and significant. Moreover, the results of the study show that there is no significant relationship between opinion shopping, type of audit report, audit market concentration, and agency costs with audit market adaptability. Originality/value The current study fills the gap in this area, and the results of the study may give direction to researchers and policy makers.

The relationship between narcissism, managerial overconfidence and comparability of financial statements of listed companies

2021 ◽  
Vol 19 (5) ◽  
pp. 681-700
Author(s):  
Mohammad Almaleki ◽  
Mahdi Salehi ◽  
Mahdi Moradi
Keyword(s):  
Stock Exchange ◽  
Chief Executive ◽  
Financial Statements ◽  
Business Environment ◽  
Multiple Regression Model ◽  
Content Type ◽  
Institutional Settings ◽  
Managerial Overconfidence ◽  
The Impact ◽  
The Relationship

Purpose This study aims to investigate the impact of managerial narcissism and overconfidence on financial statements’ comparability. In other words, this paper seeks to answer the question of whether the personality characteristics of managers may affect the level of financial statements’ quality of commercial entities or not. Design/methodology/approach The research hypotheses are tested using a sample of 896 observations taken from the Tehran Stock Exchange and 245 observations from the Iraqi Stock Exchange during 2012 and 2018 using the multiple regression model based on the combined data technique. Findings The findings show that managerial narcissism is positively and significantly associated with Iran’s financial statement comparability. In contrast, Iraqi data articulate a negative association between these two variables. This paper finds that Chief Executive Officer overconfidence and financial statements’ comparability are negatively related in both countries. Following the market variation, the different findings suggest that institutional settings such as the general managerial style, adopting international accounting standards (now IFRS) leading to the extent of auditing market globally in Iraq and suffering from international sanctions in Iran, the governing business environment may play an allocative role in preparing financial statements. Originality/value The present research is the first research conducted in two emerging markets (Iran and Iraq) examining the relationship between managers’ narcissism and overconfidence and financial statements’ comparability. Therefore, the present research in this area can significantly contribute to the development of science and knowledge.

Relationship between corporate governance and audit switching: Iranian evidence

2017 ◽  
Vol 59 (5) ◽  
pp. 673-686
Author(s):  
Mahdi Salehi ◽  
Ali Asgar Alinya
Keyword(s):  
Corporate Governance ◽  
Design Methodology ◽  
Stock Exchange ◽  
Listed Companies ◽  
Panel Analysis ◽  
Cross Sectional ◽  
Content Type ◽  
Effective Factors ◽  
Dependent Variables ◽  
The Relationship

Purpose This paper aims to investigate the relationship between corporate governance and auditors switching of listed companies on the Tehran Stock Exchange. Design/methodology/approach To achieve the objectives of this study, 12 hypotheses developed which and tests the relationship between corporate governance and selecting and switching auditors in Iran during 2008-20014 by selecting 116 listed companies on the Tehran Stock Exchange. To test the hypotheses, the cross-sectional time-series nature of research variables data, panel analysis is used. Also, to investigate the relationship between independent and dependent variables in each year, the logistic regression is used. Findings The results of the study indicate that there is a weak relationship between corporate governance auditors switching. Therefore, it could be concluded that there are some other effective factors on which selecting and switching auditors in studied companies are more dependent. Originality/value The current study is almost the first study which has been conducted in Iran, so the results of the study may be beneficial to the Iranian conditions as well as other developing countries.

The relationship between the companies’ political connections and audit fees

2020 ◽  
Vol 27 (4) ◽  
pp. 1123-1141 ◽  
Author(s):  
Mahdi Salehi
Keyword(s):  
Stock Exchange ◽  
Audit Fees ◽  
Political Connections ◽  
The Political ◽  
Content Type ◽  
Inverse Effect ◽  
Political Relationships ◽  
Auditor Selection ◽  
Relationship Of ◽  
The Relationship

Purpose The purpose of this study is to investigate whether the political connections of companies are correlated with auditor selection, audit fees and abnormal audit fees. Design/methodology/approach The research data contains 756 observations of companies listed on the Tehran Stock Exchange during 2011-2019. In this study, the relationship between companies with political relationships and the selection of a qualified auditor, audit fees and abnormal audit fees are reviewed. The regression used for test the hypotheses. Findings The results of hypotheses testing indicate that there is a positive and significant correlation between the political relationships of companies and certified auditor selection, auditing fees and abnormal audit fees. In addition, the political relationships of companies have a significant and inverse effect on the relationship between institutional ownership and auditing fee and abnormal audit fees. It was also found that there is a positive and significant correlation between companies and political relationships and abnormal audit fees. Originality/value So far several studies conducted on audit fees, however, no study conducted on the relationship of political relationship of the companies with audit fees and the results of the current study may bridge the gap in the current field.

scholarly journals Non-audit fees and auditor independence: Nigerian evidence

2019 ◽  
Vol 34 (8) ◽  
pp. 1029-1049
Author(s):  
Paul Nnamdi Onulaka ◽  
Moade Fawzi Shubita ◽  
Alan Combs
Keyword(s):  
Audit Fees ◽  
Auditor Independence ◽  
Structured Interviews ◽  
Content Type ◽  
Face To Face ◽  
External Auditors ◽  
Fund Managers ◽  
Expectation Gap ◽  
Audit Firms ◽  
Economic Necessity

Purpose This study aims to investigate the extent to which the provision of non-audit services (NAS) by external auditors to audit clients affects auditors’ independence and the audit expectation gap in Nigeria. Design/methodology/approach The study adopts an interpretivist approach. In total, 30 semi-structured, face-to-face interviews were conducted to explore the views expressed by audit partners and pension fund managers in Nigeria; group responses were evaluated and presented separately. After transcribing the interview audio recordings, a thematic data analysis of the two groups’ responses was performed. Findings Interpretation of the interview responses indicates that the provision of NAS by audit firms to their audit clients is regarded by auditors as a matter of economic necessity. Nevertheless, it is also perceived as impeding auditors’ independence and increasing the gap between the auditor and public expectations. Practical implications This study contributes to the debate surrounding the need for an independent body to oversee auditing standard setting distinct from the current practice to enhance transparency. Originality/value A qualitative analysis of the nuanced responses obtained from the semi-structured interviews reveals starkly the perceived economic pressures on auditors to accept non-audit work. Moreover, it endorses the regulation to restrict non-audit work in support of a sustainable fee level for an independent audit.

scholarly journals The effect of auditor characteristics on tax avoidance of Iranian companies

2020 ◽  
Vol 27 (2) ◽  
pp. 119-134 ◽  
Author(s):  
Mahdi Salehi ◽  
Hossein Tarighi ◽  
Tahereh Alidoust Shahri
Keyword(s):  
Stock Exchange ◽  
Emerging Market ◽  
Tax Avoidance ◽  
Audit Fees ◽  
Industry Specialization ◽  
Content Type ◽  
Auditor Industry Specialization ◽  
Auditor Tenure ◽  
The Relationship ◽  
Auditor Characteristics

Purpose The purpose of this paper is to investigate the relationship between auditor characteristics and the level of tax avoidance in an emerging market. Design/methodology/approach In this regard, the effect of various factors such as auditor tenure, auditor industry specialization, audit reports and audit fees on tax avoidance was examined. The study sample includes listed companies in the Tehran Stock Exchange. The time period of study is six years from 2011 to 2016. Also in this study, firm size, leverage, firm age and auditor size were controlled. Findings The results of this research were determined in four hypotheses. First and second hypotheses that explore the relationship between auditor tenure and auditor industry specialization with tax avoidance were not confirmed. But the results showed a significant relationship between the type of audit opinions and audit fees with tax avoidance. Originality/value The current study investigates the auditor characteristics on tax avoidance in a developing nation of Iran and the results may helpful the developing countries.

The relationship between managerial ability, earnings management and internal control quality on audit fees in Iran

2019 ◽  
Vol 69 (4) ◽  
pp. 685-703 ◽  
Author(s):  
Mahdi Salehi ◽  
Mahmoud Mousavi Shiri ◽  
Seyedeh Zahra Hossini
Keyword(s):  
Earnings Management ◽  
Internal Control ◽  
Significant Relationship ◽  
Stock Exchange ◽  
Audit Fees ◽  
Real Earnings Management ◽  
Managerial Ability ◽  
Content Type ◽  
Control Quality ◽  
The Relationship

Purpose The purpose of this paper is to emphasize the relationship between managerial ability, earnings management, internal control quality and audit fees to establish whether or not there is a significant relationship between the variables of managerial ability, earnings management, internal control quality and the audit fees. Design/methodology/approach The study sample includes 190 listed companies on the Tehran Stock Exchange during 2009–2016. Research hypotheses were tested using the statistical methods of multivariable linear regression and data envelopment analysis pattern. Findings The obtained results indicate that there is a significant and direct relationship between managerial ability and internal control quality as well as real earnings management and internal control quality. Based on the results obtained from the second hypothesis, the authors could claim that there is an inverse and significant relationship managerial ability and audit fees. The third hypothesis also revealed that in companies with lower audit fees, there is a stronger relationship between managerial ability and internal control quality. The results of related tests show no significant relationship between accrual-based earnings management and internal control quality. Originality/value This paper is the first study in Iran whose main focus is on the relationship between managerial ability, earnings management, internal control quality and audit fees.

Sign in / Sign up

Export Citation Format

Share Document