Controlling shareholder's share pledge, source of CEO and audit fees: Empirical evidence from listed family firms
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F275;F832.51;F239.4;F272.91

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    Abstract:

    In recent years, with the rapid development of society and economy, controlling shareholder's share pledge has become a very common phenomenon in China capital market. The so-called share pledge of controlling shareholders refers to a debt financing method in which controlling shareholders pledge their own shares to banks, securities companies, trust companies and other financial institutions to obtain credit funds. This financing method has more advantages than other financing methods in terms of convenience and rapidity, which can quickly help controlling shareholders solve the problem of capital shortage, but also makes enterprises face the risk of control transfer. For this reason, the share pledge behavior of controlling shareholders of listed companies has aroused widespread concern in the academic and practical circles. Although existing research has explored the influence of controlling shareholder's share pledge on corporate audit fees, few scholars have gone deep into the family firms level to explore the relationship between controlling shareholder's share pledge and audit fees. To this end, this article takes China's A-share listed family companies from 2008 to 2017 as the research object, deeply examines the impact of controlling shareholder's share pledge on audit fees, and analyzes the moderating effects of CEO from different sources. On this basis, we have carried out research design, constructed relevant research models, and verified the relevant mechanisms and hypotheses proposed in the article through descriptive statistical analysis, correlation analysis, multiple regression analysis and mechanism analysis. The study finds that the share pledge of family controlling shareholders is significantly positively correlated with the audit fees charged by auditors. At the same time, compared with family CEO, non-family CEO will significantly weaken the positive correlation between the family controlling shareholder's share pledge and audit fees. Further analysis finds that the controlling shareholder's share pledge will lead to a significant increase in corporate governance risks and earnings manipulation risks, thereby increasing the audit fees of the family firms. Finally, after considering potential endogenous issues, re-measurement of audit fees, and narrowing the sample range of family firms, our research conclusions remain unchanged. The above research conclusions show that the risk arising from the share pledge by the controlling shareholder of the family firms can be identified by the auditor, therefore the auditor will compensate by charging more audit fees. At the same time, the non-family CEO can restrict the family controlling shareholder's benefit encroachment, which will help auditors to better identify the risks arising from the family controlling shareholder's share pledge. Therefore, auditors can implement differentiated charging strategies based on the different sources of family firms CEO. This article not only extends the controlling shareholder's share pledge to the family firms level for research, but also enriches and supplements the relevant literature on audit fees. So, it has certain theoretical contributions and practical significance for auditors to implement differentiated charging strategies.

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苏春,刘星.控股股东股权质押、CEO来源与审计费用——来自上市家族企业的经验证据[J].重庆大学学报社会科学版,2022,28(5):73~91

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  • Online: November 07,2022
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