Open AccessInvestigating the effect of the Board of Directors characteristics on auditor selection in the companies listed in Tehran Stock Exchange
Author(s) -
Abolfazl Ghadiri Moghadam,
Mahdi Filsaraei,
Maliheh Dorostkar,
Arezou Rezvani,
Fatemeh Yeganeh Pahlavanlou
Publication year - 2020
Publication title -
journal of management and accounting studies
Language(s) - English
Resource type - Journals
ISSN - 2693-8448
DOI - 10.24200/jmas.vol6iss02pp7-13
Subject(s) - accounting , business , audit , external auditor , stock exchange , auditor's report , auditor independence , quality audit , audit substantive test , quality (philosophy) , joint audit , internal audit , finance , philosophy , epistemology
Objective: Increasing the number of users of the audit report, as customers of this public good, has caused the quality of the auditors‟ job to be put under observation. Methodology: Quality of the auditors‟ work and their opinion can lead to improving the financial information system of countries and finally optimal economic decision-making. Result: The results of studying the research variables among 74 companies in 6 industries, using multiple linear regression and panel data, showed that the Board size has a significant inverse relationship with auditor tenure. But this variable has no significant relationship with auditor size. So, it is suggested that acceptable standards be considered for auditor selection in order to improve the audit procedures so that the auditor tenure will be less affected by the Board size and also personal judgments. In addition, the proportion of outside directors has no significant relationship with auditor tenure and auditor size. Conclusion: The results indicated that the company size has a significant positive relationship with the auditor size. Thus, larger companies use larger firms for auditor selection. Accordingly, it is recommended that larger organizations should employ larger audit firms to enhance audit quality.