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Secrecy Culture and Audit Opinion: Some International Evidence
Author(s) -
Chen Theodore T. Y.,
Zhang Feida Frank,
Zhou Gaoguang Stephen
Publication year - 2017
Publication title -
journal of international financial management and accounting
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.818
H-Index - 37
eISSN - 1467-646X
pISSN - 0954-1314
DOI - 10.1111/jifm.12057
Subject(s) - secrecy , audit , accounting , business , sample (material) , public relations , political science , law , chemistry , chromatography
We examine whether and how auditors respond to audit risks arising from secrecy culture when making audit opinion decisions. Using a sample of international Big N auditors from 33 countries, we find strong and robust evidence that auditors are more likely to issue modified audit opinions to clients domiciled in countries with a strong secrecy culture. In addition, we find that the association between secrecy culture and auditors' propensity to issue modified audit opinions is less pronounced in countries with strong investor protection than that in countries with weak investor protection.