Does Sharing Auditor Impact Suppliers' Relationship-specific Investment?

Abstract

Abstract: Relationship-specific investment of suppliers may be faced with held-up problem, which means relationship-specific assets should be under-invested if suppliers are not properly encouraged. Information asymmetry will aggravate this problem. Therefore reducing the degree of information asymmetry between suppliers and customers will effectively promote the relationship-specific investment. This paper takes firms listed in China’s capital market from 2009 to 2015 as sample, examines the role of the auditor as an information intermediary and finds that sharing auditor with customers will increase relationship-specific investment, and when customer and supplier have less accounting comparability, customers are less trusted by suppliers and auditor has higher ability to gather or communicate soft information, the information intermediary role of auditor in promoting suppliers’ specific investment is more significant. Further results show that the role of shared auditor in promotion of relation-specific investment is more significant in firms with more competitive customers and more serious financial constraints.

Key words: shared auditor, relationship-specific investment, accounting comparability, soft information

Hu Zhiying, Tong Menglu, Liu Tongtong. Does Sharing Auditor Impact Suppliers' Relationship-specific Investment?[J]. Management Review, 2022, 34(2): 291-302.

References

[1] Williamson O. The Economic Institutions of Capitalism[M]. New York:Free Press, 1985
[2] Goltsman M. Optimal Information Transmission in a Holdup Problem[J]. RAND Journal of Economics, 2011,42(3):495-526
[3] Allen J., Phillips G. Corporate Equity Ownership, Strategic Alliances, and Product Market Relationships[J]. Journal of Finance, 2000,55(6):2791-2815
[4] 于茂荐,孙元欣. 专用性投资、法律制度环境与治理机制选择——基于制造业上市公司的经验证据[J]. 山西财经大学学报, 2016,38(3):45-55
[5] Giannetti M., Burkart M., Ellingsen T. What You Sell Is What You Lend? Explaining Trade Credit Contracts[J]. Review of Financial Studies, 2011,24(4):1261-1298
[6] Raman K., Shahrur H. Relationship-Specific Investments and Earnings Management:Evidence on Corporate Suppliers and Customers[J]. Accounting Review, 2008,83(4):1041-1081
[7] 林钟高,郑军,彭琳. 关系专用性投资、制度环境与盈余管理[J]. 北京工商大学学报(社会科学版), 2014,29(1):13-21
[8] 于茂荐,孙元欣. 基于关系契约的专用性投资治理研究[J]. 兰州商学院学报, 2012,28(1):95-100
[9] Hermalin B. E., Katz M. L. Information and the Hold-up Problem[J]. The Rand Journal of Economics, 2009,40(3):405-423
[10] 姚海鑫,李璐. 共享审计师可以提高并购绩效吗?——来自中国A股上市公司的经验证据[J]. 审计与经济研究, 2018,33(3):29-39
[11] Dhaliwal D. S., Shenoy J., Williams R. Common Auditors and Relationship-Specific Investment in Supplier-Customer Relationships[R]. University of Arizona, Working Paper, 2017
[12] 胡安宁,周怡. 再议儒家文化对一般信任的负效应——一项基于年中国居民调查数据的考察[J]. 社会科学家, 2013,(2):28-54
[13] 杨清香,姚静怡,张晋. 与客户共享审计师能降低公司的财务重述吗?——来自中国上市公司的经验证据[J]. 会计研究, 2015,(6):72-79
[14] 蔡利,郑倩雯,蔡春. 共享审计师能降低分析师预测偏差吗?——来自中国A股上市公司的经验证据[J]. 审计研究, 2018,(1):86-93
[15] 刘文军,谢帮生. 分析师预测信息来源的新发现:会计师事务所[J]. 财经研究, 2017,43(5):76-88
[16] Cai Y., Kim Y., Park J. C., et al. Common Auditors in M&A Transactions[J]. Journal of Accounting and Economics, 2016,61(1):77-99
[17] Kale J., Shahrur H. Corporate Capital Structure and the Characteristics of Suppliers and Customers[J]. Journal of Financial Economics, 2007,83(2):321-365
[18] 林钟高,郑军,汤谢莹. 关系专用性投资与高管薪酬业绩敏感性[J]. 财经研究, 2014,40(9):133-144
[19] 王雄元,喻长秋. 专有化成本与公司自愿性信息披露——基于客户信息披露的分析[J]. 财经研究, 2014,40(12):27-38
[20] Williamson O. The Vertical Integration of Production:Market Failure Considerations[J]. American Economic Review, 1971,61(2):112-123
[21] Costello A. Mitigating Incentive Conflicts in Inter-Firm Relationships:Evidence from Long-Term Supply Contracts[J]. Journal of Accounting and Economics, 2013,56(1):19-39
[22] Heide J. B., Wathne K. H., Rokkan A. I. Interim Monitoring, Social Contract and Relationship Outcomes[J]. Journal of Marketing, 2007,44(3):425-433
[23] Williamson O. Markets and Hierarchies:Analysis and Antitrust Implications[M]. New York:Free Press, 1975
[24] Lau S. Information and Bargaining in the Hold-up Problem[J]. RAND Journal of Economics, 2008,39(1):266-282
[25] Chen H., Jeter D. The Role of Auditing in Buyer-Supplier Relations[J]. Journal of Contemporary Accounting and Economics, 2008,4(1):1-17
[26] 方红星,张勇. 供应商/客户关系型交易、盈余管理与审计师决策[J]. 会计研究, 2016,(1):79-86
[27] 张敏,马黎珺,张胜. 供应商-客户关系与审计师选择[J]. 会计研究, 2012,(12):81-86
[28] Francis J., Wang W. Common Auditors and Private Bank Loans[J]. Contemporary Accounting Research, 2021,38(1):793-832
[29] 唐跃军. 转轨经济中内部人控制分析[J]. 国际经济合作, 2002,(2):41-45
[30] 唐跃军. 论转轨经济中的内部人控制与道德风险[J]. 经济评论, 2002,(6):33-38
[31] Wang Q., Wong T. J., Xia L. State Ownership, the Institutional Environment, and Auditor Choice:Evidence from China[J]. Journal of Accounting and Economics, 2008,46(1):112-134
[32] 雷丁著,谢婉莹译. 华人资本主义精神[M]. 上海:格致出版社, 2009
[33] 张维迎,柯荣住. 信任及其解释:来自中国的跨省调查分析[J]. 经济研究, 2002,(10):59-70
[34] 胡志颖. 女性CEO, 社会信任和公司融资约束[J]. 经济管理, 2015,(8):88-98
[35] Boerner C., Macher J. Transaction Cost Economics:An Assessment of Empirical Research in Social Science[R]. Working paper, Duke Law School Legal Studies Paper, 2006
[36] Levy D. The Transactions Cost Approach to Vertical Integration:An Empirical Examination[J]. Review of Economics and Statistics, 1985,67(3):438-445
[37] Franco F. D., Kothari S. P., Verdi R. S. The Benefits of Financial Statement Comparability[J]. Journal of Accounting Research, 2011,49(4):895-931
[38] 刘凤委,李琳,薛云奎. 信任、交易成本与商业信用模式[J]. 经济研究, 2009,(8):60-72
[39] 裘宗舜,韩洪灵. 审计独立性之风险:一个分析框架[J]. 会计研究, 2003,(6):32-35
[40] Krishnan G. V. Does Big 6 Auditor Industry Expertise Constrain Earnings Management?[J]. Accounting Horizon, 2003,17(S1):1-16
[41] Lai K. M. Y., Srinidhi B., Gul F. A., et al. Board Gender Diversity, Auditor Fees, and Auditor Choice[J]. Contemporary Accounting Research, 2017,34(3):1681-1714
[42] Choi J. H., Kim J. B., Qiu A. A. Geographic Proximity between Auditor and Client:How does It Impact Audit Quality?[J]. Auditing:A Journal of Practice and Theory, 2012,31(2):43-72
[43] Hadlock C. J., Pierce J. R. New Evidence on Measuring Financial Constraints:Moving beyond the KZ Index[J]. The Review of Financial Studies, 2010,23(5):1909-1940