Is there an association between accounting firm ranks and audit quality? An examination of the top 100 accounting firms in China
Ting Chiao Huang et al.
Using 15,354 firm-year observations from Chinese listed companies from 2003 to 2013, we examine the association between accounting firm ranks, disclosed by the Chinese Institute of Certified Public Accountants (CICPA), and audit quality. The results show that clients audited by higher ranked accounting firms report lower discretionary accruals and are more likely to receive modified audit opinions. Additionally, accounting firm ranks are found to better capture audit quality after recent modific