Abstract
This study extends agency theory by explaining the client's understanding of audit quality. This study contributes to the audit literature by examining the effect of wedge control-ownership on industry specialist auditors that have not been researched in Turkey. The interests of minority and controlling shareholders are not completely compatible. The research analysis method used a logistic regression model, finding that firms that practice a larger difference between control rights and cash flow rights tend to prefer high audit quality measures by industry specialist auditors. This study encourages regulators to improve law enforcement to enhance the role of corporate governance in Turkey to address the features of ownership-control firms and offer a suitable environment for investment and minority shareholders.
Highlights
This study aims to examine the influence of ownership structure on corporate governance mechanism proxy by industry specialist auditor
This study contributes to the audit literature by examining the effect of wedge control-ownership on industry specialist auditors that have not been researched in Turkey
The mean of industry specialist auditor is 0.167 for all firms included in this study sample, the standard deviation is 0.234, and the range is from a 0.000 minimum to a 0.984 maximum
Summary
This study aims to examine the influence of ownership structure on corporate governance mechanism proxy by industry specialist auditor. Corporate governance has important role to offer suitable environment for investment (Shleifer & Vishny, 1997). It attracts great attention as a consequence of company scandals and collapses, for example, Worldcom and Enron. Organization for Economic Corporation and Development (OECD) worked to issue the code of corporate governance. The Capital Market Board of Turkey (CMBT) amended Turkey governance principles to rectify its capital market to link it to that of Europe in early 2012. By doing this Turkey can obtain membership in the EU
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