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Does auditor gender affect issuing going‐concern decisions for financially distressed clients?
Author(s) -
Hossain Sarowar,
Chapple Larelle,
Monroe Gary S.
Publication year - 2018
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/acfi.12242
Subject(s) - audit , affect (linguistics) , business , auditor's report , accounting , going concern , sample (material) , audit evidence , quality audit , perception , quality (philosophy) , joint audit , actuarial science , psychology , internal audit , chemistry , communication , chromatography , neuroscience , philosophy , epistemology
We investigate whether an audit partner's gender is associated with the likelihood of issuing a going‐concern opinion for a financially distressed client. Our analysis is based on data for a sample of Australian listed companies for the period 2003–2011. Our results from unrestricted and propensity score‐matched samples and a Heckman two‐stage model indicate that female audit partners are less likely to issue a going‐concern opinion for financially distressed clients. Our findings provide evidence of differential audit outcomes depending on the gender of the audit partner, thus implying that audit partner gender affects the decision‐making processes used when making the audit reporting decision. These behavioural differences have the potential to influence perceptions of financial reporting and audit quality.