Auditors’ Social Network Relationship and Enterprise Risk-taking: An Empirical Analysis of A-share Listed Companies——Empirical analysis From A-share Listed Companies
Auditors’ Social Network Relationship and Enterprise Risk-taking: An Empirical Analysis of A-share Listed Companies——Empirical analysis From A-share Listed Companies
LIAO Yigang1,2, HE Li1, YE Chenghui1
1. School of Accountancy,Jiangxi University of Finance and Economics,Nanchang 330013, China; 2. Accounting Development Research Center,Jiangxi University of Finance and Economics,Nanchang 330013, China
Abstract Taking A-share listed companies from 2010 to 2018 as research samples, this paper analyzes and examines the impact of auditors’ social network relationships on corporate risk-taking. The result shows that that auditors’ social network relationships can enhance corporate risk-taking. The mechanism test indicates that auditors’ social networks can enhance the level of corporate risk-taking by alleviating financing constraints, reducing information asymmetry, and alleviating agency problems. Furthermore, Further tests show that when the audit tenure is shorter, the clients face more investment opportunities, the higher the customers’ external financing demand, and the worse the business environment in the area where the customers are located, the auditor social network relationship has a more significant positive impact on corporate risk-taking. Compared with the political social network, the commercial social network of auditors is more helpful to improve the risk-taking level of enterprises. The study of economic consequences shows that the improvement of the level of enterprise risk taking caused by the auditors’ social network relationship is ultimately conducive to the promotion of enterprise value. The above research conclusions can provide ideas for firms to accumulate human capital and social capital, independent audit to play a supervisory role, and micro-enterprises to expand access to resources.
2023, Vol. 40 
