The Effect of Client Industry Agglomerations on Auditor Industry Specialization

IF 4.9 2区管理学 Q1 BUSINESS, FINANCE

Journal of Accounting Research Pub Date : 2023-08-09 DOI:10.1111/1475-679X.12503

W. ROBERT KNECHEL, DEVIN WILLIAMS

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Abstract

Prior research on auditor industry specialization documents fee premiums for local audit offices that are industry specialists. This research assumes that the effects of specialization are uniform across markets. We examine industry specialization based on the economic theory of industry agglomeration (geographic areas with high industry concentration). Agglomeration economies can facilitate access to knowledge for auditors serving a specific industry in those locations. We find that industry specialists in agglomerations earn a fee premium in excess of specialists in other markets. We find that nonspecialist offices in agglomerations also earn fee premiums in that industry when compared to nonspecialists in other markets even when controlling for these groups’ absolute share of the national market. We also address whether or not this expertise can be shared among offices in an agglomeration specialist's firm. We find that audit offices that have easy connections to a within-firm office in an agglomerated market can earn a fee premium relative to more distant offices, suggesting a benefit from knowledge transfer. This fee premium accrues to offices that would not be considered a specialist using traditional market share measures in a given industry. These findings indicate that the benefit of industry specialization depends on more than local market share.

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客户行业集聚对审计行业专业化的影响

先前对审计师行业专业化的研究记录了作为行业专家的地方审计机构的费用溢价。这项研究假设专业化的影响在各个市场是一致的。我们基于产业集聚的经济理论（产业高度集中的地理区域）来考察产业专业化。集聚经济可以促进为这些地区特定行业服务的审计师获得知识。我们发现，集聚区的行业专家的费用溢价超过了其他市场的专家。我们发现，与其他市场的非专业人员相比，即使在控制这些集团在全国市场的绝对份额的情况下，聚集区的非专业办公室在该行业也会获得费用溢价。我们还讨论了这种专业知识是否可以在集聚专家公司的办公室之间共享。我们发现，与更远的办公室相比，在聚集的市场中，与公司内部办公室有着简单联系的审计办公室可以获得费用溢价，这表明知识转移带来了好处。该费用溢价应计入在特定行业中使用传统市场份额衡量标准不被视为专家的办公室。这些发现表明，行业专业化的效益不仅仅取决于当地市场份额。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of Accounting Research BUSINESS, FINANCE-

CiteScore

7.80

自引率

6.80%

发文量

期刊介绍： The Journal of Accounting Research is a general-interest accounting journal. It publishes original research in all areas of accounting and related fields that utilizes tools from basic disciplines such as economics, statistics, psychology, and sociology. This research typically uses analytical, empirical archival, experimental, and field study methods and addresses economic questions, external and internal, in accounting, auditing, disclosure, financial reporting, taxation, and information as well as related fields such as corporate finance, investments, capital markets, law, contracting, and information economics.