The Impact of Audit Firm Tenure on The Quality of Financial Reporting in The TSE Listed Companies
Quarterly Journal of Securities Exchange

Quarterly Journal of Securities Exchange

The Impact of Audit Firm Tenure on The Quality of Financial Reporting in The TSE Listed Companies

Document Type : Original Article

Authors
mahdi mahmoudi
Yahya Hasas Yeganeh
Rasool Zabihi
10.22034/jse.2017.11099
Abstract
This study examines whether the length of the relationship between a company and an audit firm (audit-firm tenure) is associated with financial reporting quality. Using two proxies for financial reporting quality. The population of this study is that the companies accepted the Tehran Stock Exchange, according to the definition of the study for The period of audit-firm tenure which is at least five consecutive years.
Time domain of research is 1381 – 1390 (2002-2011) and the data evaluated in this study is extracted from the audited financial statement of The company’s stocks. It is explained that the Pearson correlation test and multiple regression to investigate the relationship between independent and dependent variables and also determining the direction and extent of these relationships are considered. We found a relationship between short audit-firm tenure of one to two years and quality of financial reports. In contrast, we found no evidence of relative financial reporting quality for longer audit firm tenures and medium audit firm tenures.
Keywords
Audit – Firm tenure
Audit Quality
Financial-Reporting Quality
Mandatory Auditor Rotation
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