The effect of disclosing the difference between the auditor and the client on the dismissal of the auditor and the audit fee paid to the successor auditors in the companies listed on the Tehran Stock Exchange

Document Type : Original Article

Authors

1 Assistant Professor, Department of Accounting, Parandak institute of higher education, Parandak, Iran.

2 M.Sc.of Accounting, Parandak institute of higher education, Parandak, Iran.

Abstract

The financial statements are considered as joint statements by the auditor and management, and are the result of negotiations and bargaining between management and the auditor. Disclosure of the auditor's resignation may be costly for stakeholders because investors react negatively to the auditor's resignation. If management believes that Carter's current conservative auditor is a successor to the auditor, he's dismissing the current auditor and hiring a less conservative auditor instead. In this study, the effect of disclosing the auditor-client dispute on the auditor's resignation and the audit fee paid to the successor auditors in the companies listed on the Tehran Stock Exchange has been investigated. The statistical population of the present study is the companies listed on the Tehran Stock Exchange during the years 1392 to 1398. The sample size according to the screening method and after removing Perth observations is equal to 175 companies.) With fixed effects. The results of analyzing company data using multivariate regression at 95% confidence level show that there is a significant and positive relationship between disclosure of the auditor-client disagreement and the audit fee paid to successor auditors. Also, other research results Indicates that there is a significant relationship between disclosure of the auditor-client dispute and the auditor's resignation.

Keywords


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