Political Connection and the Demand for Industry Specialist Auditors

  title={Political Connection and the Demand for Industry Specialist Auditors},
  author={L. Z. Brooks},
  journal={Accounting and Finance Research},
  • L. Z. Brooks
  • Published 2016
  • Economics
  • Accounting and Finance Research
  • Prior literature suggests that political connected firms are more likely to be associated with lower financial reporting quality than non-political connected firms. Industry specialist auditors have a higher reputation to provide high quality audit. Thus, I hypothesize that political connected firms have a higher demand for industry specialists in order to minimize the agency costs associated with political connection. Consistent with my prediction, I find a significant positive association… CONTINUE READING
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