Concentration of the supply chain and audit opinion shopping: the case of China

Xue, Shuang; Yao, Youfu; Wang, Xuefang

doi:10.1080/21697213.2018.1521955

Cited by 3 publications

(6 citation statements)

References 32 publications

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“…Kondisi tersebut juga meningkatkan kompetisi pasar audit yang tinggi antar KAP non big four yang dapat mengakibatkan terjadinya penurunan biaya audit dan shopping opinion. Hal ini didukung oleh penelitian Xue, Yao, and Wang (2018) yang menyatakan bahwa kompetisi pasar audit yang tinggi dapat menyebabkan terjadinya shopping opinion. Karena setiap KAP harus bersaing dengan KAP lain untuk mendapatkan klien dan hal ini dapat menyebabkan adanya kesetaraan antara KAP dan klien.…”

Section: Pendahuluanunclassified

Determinan Shopping Opinion: Perspektif Klien Dan Kantor Akuntan Publik

Ulfa

Sulhani

2021

JAS

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This study analyzes the effect of audit market competition, client size, and financial distress on shopping opinions. The sample used in this study is a manufacturing company listed on the Indonesia Stock Exchange for 2016 to 2017. The data used in the study were 76 data from the company's annual reports. The data analysis method used was binary logistic regression. This study indicates that audit market competition and client size do not affect shopping opinion practices. However, financial distress has a significant positive effect on the tendency to practice shopping opinion. This indicates that a company with an excellent financial condition chooses to change its auditor compared to the same auditor; this is done because financially, the company can change public accounting.

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Section: Pendahuluanunclassified

Determinan Shopping Opinion: Perspektif Klien Dan Kantor Akuntan Publik

Ulfa

Sulhani

2021

JAS

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“…An appropriate level of customer concentration promotes enterprises to have sustainable technological innovations by removing financing constraints and increasing the resource supply [41]. Also, an appropriate level of customer concentration creates the spillover effect of identifying corporate information, sends the signal of stable performances and low default risks to banks, reduces information asymmetry between banks and enterprises, and removes financing constraints [29]. Secondly, the existence of large clients sends to the capital market the sign of effective supply chain integration, good operating status, and low corporate risks, which in turn reduces equity capital costs for enterprises [28].…”

Section: Customer Concentration and Enterprise Sustainable Innovationmentioning

confidence: 99%

“…From the lowest level to the appropriate level of customer concentration, enterprises can have sustainable technological innovations by removing financing constraints and augmenting the resource supply [41]. This appropriate level of customer concentration can provide the signal of the spillover effect for identifying corporate information which results in low default risks to banks, reduces information asymmetry between banks and enterprises [29]. Management and information systems studies support the notion of which these "partners can mutually benefit through more extensive collaboration and coordination efforts" [56] (p.185).…”

Section: Economic Policy Uncertainty Customer Concentration and Entmentioning

confidence: 99%

“…The second one is the client risk hypothesis. According to the supply-chain integration hypothesis, a high customer concentration integrates supply chain resources between enterprises on the upper and lower streams and coordinates finance to reduce financial constraints on enterprises [27][28][29], supervises the managerial staff's opportunist behaviors [30], reduces risks for the stock market crash [31] to increase corporate values. According to the client risk hypothesis, clients in an advantaged transaction status are likely to encroach on and exploit enterprises, which bring potential operation and financial risks for enterprises [32][33][34], and reduce corporate values.…”

Section: Introductionmentioning

confidence: 99%

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Customer Concentration, Economic Policy Uncertainty and Enterprise Sustainable Innovation

et al. 2020

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Few studies have addressed how customer concentration affects the decision of a firm’s research and development (R&D) strategies and then innovation outcome. Using a sample of China’s listed companies for the period from 2009 to 2017, this study investigates the relationship between customer concentration and enterprise sustainable innovations, as well as how such the relationship changes with economic policy uncertainty. The findings imply that there is a significant inverted-U-shaped relationship between customer concentration and enterprise sustainable innovations. Under a high level of economic policy uncertainty, the advantage of the customer relationship is maximized. In this context, raising customer concentration significantly promotes enterprise sustainable innovations. Customer concentration affects innovations differently as the equity properties, and locations of enterprises vary under different levels of economic policy uncertainty. Thus, the interval of customer concentration conducive to enterprise innovations differs. The results are robust to econometric techniques that control for endogeneity. Overall, our findings suggest that enterprises build and adjust the customer relationship and improve the driving mechanism for sustainable innovations.

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“…Third, a firm's incentives to share information with suppliers depend on its bargaining position vis-à-vis its suppliers. When a firm has relatively high dependence on its suppliers and large switching cost, its suppliers usually have higher bargaining power over the firm (Porter, 1998;Xue et al, 2018). In such scenarios, reducing information asymmetry along the supply chain becomes more important, and a firm would make more efforts to satisfy suppliers' information need.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Top executives’ school-tie connections and management forecast disclosure

Luo

2020

China Journal of Accounting Studies

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This paper investigates whether top executives' dependence on social connections has an impact on the information environment of listed companies. Specifically, this paper explores the role of school ties between firms' and suppliers' top executives on management earnings forecasts, an important channel of public information disclosure. We find a negative relation between a firm's school ties with its suppliers and the likelihood/frequency to issue management forecasts, indicating that top executives' school ties in a way substitute management forecasts and become the information channel along the supply chain. Further, we find the association is stronger when the firm faces higher proprietary cost or operational uncertainty, but the association becomes weaker when suppliers have bargaining advantage over the firm. Finally, we find the decrease in management forecast disclosure driven by school-tie connections weakens the access of firm-specific information for external information users, which may put individual investors in a more vulnerable position.

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Concentration of the supply chain and audit opinion shopping: the case of China

Cited by 3 publications

References 32 publications

Determinan Shopping Opinion: Perspektif Klien Dan Kantor Akuntan Publik

Determinan Shopping Opinion: Perspektif Klien Dan Kantor Akuntan Publik

Customer Concentration, Economic Policy Uncertainty and Enterprise Sustainable Innovation

Top executives’ school-tie connections and management forecast disclosure

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