Does Auditor Gender Affect Issuing Going‐Concern Decisions for Financially Distressed Clients?

35 Pages Posted: 14 Dec 2018

See all articles by Sarowar Hossain

Sarowar Hossain

University of New South Wales (UNSW)

Larelle Chapple

Queensland University of Technology - QUT Business School

Gary S. Monroe

University of New South Wales (UNSW) - Australian School of Business

Date Written: December 2018

Abstract

We investigate whether an audit partner's gender is associated with the likelihood of issuing a going‐concern opinion for a financially distressed client. Our analysis is based on data for a sample of Australian listed companies for the period 2003–2011. Our results from unrestricted and propensity score‐matched samples and a Heckman two‐stage model indicate that female audit partners are less likely to issue a going‐concern opinion for financially distressed clients. Our findings provide evidence of differential audit outcomes depending on the gender of the audit partner, thus implying that audit partner gender affects the decision‐making processes used when making the audit reporting decision. These behavioural differences have the potential to influence perceptions of financial reporting and audit quality.

Keywords: Auditor gender, Audit quality, Going‐concern opinion

Suggested Citation

Hossain, Sarowar and Chapple, Larelle and Monroe, Gary S., Does Auditor Gender Affect Issuing Going‐Concern Decisions for Financially Distressed Clients? (December 2018). Accounting & Finance, Vol. 58, Issue 4, pp. 1027-1061, 2018, Available at SSRN: https://ssrn.com/abstract=3300899 or http://dx.doi.org/10.1111/acfi.12242

Sarowar Hossain (Contact Author)

University of New South Wales (UNSW) ( email )

Kensington
High St
Sydney, NSW 2052
Australia

Larelle Chapple

Queensland University of Technology - QUT Business School

GPO Box 2434
Brisbane, Queensland 4001
Australia

Gary S. Monroe

University of New South Wales (UNSW) - Australian School of Business ( email )

UNSW Business School
High St
Sydney, NSW 2052
Australia
+61293856443 (Phone)

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