Abstract
ABSTRACTPrevious research reports a lower cost of debt when auditors are industry specialists at the national- and city-levels and at the firm- and office-levels. This study examines whether the cost of debt decreases with auditor industry specialization at the engagement partner level. Most audits are conducted on private companies and audit partners mainly gain industry expertise on private company audits. This paper uses data from public and private companies in Thailand and investigates the moderating effects of company type and the global financial crisis (GFC) on the association between auditor industry specialization and the cost of debt. The results indicate that audit partner industry specialization is negatively associated with the cost of debt only in the GFC period. In contrast to findings from prior studies, I find no additional benefit from hiring an industry specialist during the non-crisis period.JEL Classifications: G21; M42.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
