Journal of Business Ethics 103 (4):621-638 (2011)
|Abstract||Two types of guanxi have a close association with auditor independence in China: firm-level connections derived from state ownership and personal connections developed through management affiliations with external auditors. This article examines the effects of these two types of connection and their joint effect on audit quality. We find that state ownership and management affiliations with the external auditor both increase the probability of receiving a clean audit opinion in China. Furthermore, the probability increment brought by management affiliations for non-state-owned enterprises (NSOEs) is greater than that for state-owned enterprises (SOEs). These results suggest that state ownership and management affiliations are two important types of connection that impair auditor independence, and that management affiliations are of greater importance to private-sector firms than to SOEs|
|Keywords||guanxi auditor independence corporate governance state ownership business ethics China|
|Categories||categorize this paper)|
|Through your library||Configure|
Similar books and articles
Qi Li, Wei Luo, Yaping Wang & Liansheng Wu (2013). Firm Performance, Corporate Ownership, and Corporate Social Responsibility Disclosure in China. Business Ethics 22 (1):159-173.
Alan K. M. Au & Danny S. N. Wong (2000). The Impact of Guanxi on the Ethical Decision-Making Process of Auditors – an Exploratory Study on Chinese CPAs in Hong Kong. Journal of Business Ethics 28 (1):87 - 93.
Chenting Su, Ronald K. Mitchell & M. Joseph Sirgy (2007). Enabling Guanxi Management in China: A Hierarchical Stakeholder Model of Effective Guanxi. [REVIEW] Journal of Business Ethics 71 (3):301 - 319.
Meiling Wong (2010). Guanxi Management as Complex Adaptive Systems: A Case Study of Taiwanese Odi in China. [REVIEW] Journal of Business Ethics 91 (3):419 - 432.
Roger Hussey & George Lan (2001). An Examination of Auditor Independence Issues From the Perspectives of U.K. Finance Directors. Journal of Business Ethics 32 (2):169 - 178.
Chenting Su & James E. Littlefield (2001). Entering Guanxi: A Business Ethical Dilemma in Mainland China? [REVIEW] Journal of Business Ethics 33 (3):199 - 210.
Yi Zhang & Zigang Zhang (2006). Guanxi and Organizational Dynamics in China: A Link Between Individual and Organizational Levels. [REVIEW] Journal of Business Ethics 67 (4):375 - 392.
Hollis Ashbaugh (2004). Ethical Issues Related to the Provision of Audit and Non-Audit Services: Evidence From Academic Research. [REVIEW] Journal of Business Ethics 52 (2):143-148.
Thomas W. Dunfee & Danielle E. Warren (2001). Is Guanxi Ethical? A Normative Analysis of Doing Business in China. Journal of Business Ethics 32 (3):191 - 204.
Nonna Martinov-Bennie & Gary Pflugrath (2009). The Strength of an Accounting Firm's Ethical Environment and the Quality of Auditors' Judgments. Journal of Business Ethics 87 (2):237 - 253.
Wenjing Li & Ran Zhang (2010). Corporate Social Responsibility, Ownership Structure, and Political Interference: Evidence From China. [REVIEW] Journal of Business Ethics 96 (4):631 - 645.
Ran Zhang, Zabihollah Rezaee & Jigao Zhu (2010). Corporate Philanthropic Disaster Response and Ownership Type: Evidence From Chinese Firms' Response to the Sichuan Earthquake. [REVIEW] Journal of Business Ethics 91 (1):51 - 63.
Michael A. Pearson (1985). Enhancing Perceptions of Auditor Independence. Journal of Business Ethics 4 (1):53 - 56.
Liang-Hung Lin & Yu-Ling Ho (2010). Guanxi and OCB: The Chinese Cases. [REVIEW] Journal of Business Ethics 96 (2):285 - 298.
Marietta Peytcheva & Danielle E. Warren (2011). Auditor Professionalism. Business and Professional Ethics Journal 30 (1-2):33-57.
Added to index2011-10-12
Total downloads6 ( #154,629 of 722,745 )
Recent downloads (6 months)1 ( #60,247 of 722,745 )
How can I increase my downloads?