JOURNAL OF ACCOUNTING AND FINANCE
Audit Office Size, Client Characteristics and Cost of Bank Loans
Author(s): Hongmei Jia, Sandra Gates
Citation: Hongmei Jia, Sandra Gates, (2018) "Audit Office Size, Client Characteristics and Cost of Bank Loans", Journal of Accounting and Finance, Vol. 18, ss. 4, pp.11-22
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This study examines the association between the size of the audit office and the cost of their clients’ bank loans. The results show that the loan spread of the client is negatively associated with the size of the audit office after controlling all other known loan characteristics and client characteristics. After using Propensity-Score Matching, the negative association disappears, and the results suggest that the
difference in the cost of bank loans among the different size of audit offices is largely related to client
characteristics. This study provides further evidence about the relationship between auditors and client
bank loans.