| Summary: | 碩士 === 東海大學 === 會計學系 === 99 === This study explore whether there are distinct differences between the profit management control effect on the control deviation of control shareholders and pledge shares or not, which are triggered by the intra-groups and inter-groups auditor rotation in big accounting firms under the coercive rotation. Hoping to comprehend the practical audit quality after the mandatory rotation and present some valuable reference supplementary for rotation policy, by analysing on the controlled shareholders core agent problem and comparing the audit quality among different group-types of accountant rotation.
This research targets on the public companies audited by the Big Four in Taiwan from 2003 to 2009. The group data are collected from the Big Four, and via the propensity score matching method to control the endogenous of the intra-group and inter-group accountant rotation, so as to separate the potential self-selection bias on accountant rotation for organizations. When it comes to profit management, the discretionary accrual helps to analysis.
The finding demonstrates that the inter-group rotation outweighs the intra-rotation on restraining the profit managing behavior from control deviation of controlling shareholders under the coercive rotation, there is nothing different even on the consideration of the independence of directors. The implication is that it helps for enhancing the audit quality and reducing the opportunity of profit control on the control shareholders by demanding the inter-group accountant rotation. On the other hand, there is no evidence demonstrates the performance of retraining on controlling stockholders’ pledge shares of inter-group accountant rotation better-performs than intra-group rotation. Instead, the higher ratio of restraining pledge share it is, the more cautious and more careful on audit behavior on inter-group rotation would be. Therefore, compare to intra-group rotation, accountants prefer exercising on reducing on profit discretionary accrual.
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