臺大管理論叢 NTU Management Review VOL.30 NO.2

Do Government Initiatives and Reasons for Auditor-Client Realignment Influence Audit Fees and Audit Quality? Evidence from China 236 4.2 Regression Analysis 4.2.1 Reasons to Disclose Auditor-Client Realignment Decisions As stated in Research Question 1, we investigate whether state ownership and the government initiative influence managerial decisions to disclose the reasons for auditor- client realignment. As one can find in Model (1), the dependent variable is REASON_ DISCLOSURE . Since the dependent variable is binary, “to disclose” versus “not to disclose,” state ownership ( STATE ) and the government initiative ( POST_2007 ) are treated as independent variables. Thus, we are able to examine the joint effect of these two independent variables on decisions to disclose the reasons for realignment. Table 5 E ff ects of State Ownership and of the Governmental Initiative on Reasons for Disclosing Auditor-Client Realignment Variable Coefficient p -value Intercept -2.082 0.016 STATE 0.430 0.009 POST_2007 1.001 <0.001 STATE × POST_2007 -0.645 0.001 LNTA 0.051 0.175 D_LNTA 0.124 0.089 CFOTA -0.635 0.177 NEWFINANCING 0.162 0.412 TIE -0.002 0.050 DA -0.382 0.013 LEGALFORMLLP 0.308 0.128 LEGALFORMLLC -0.029 0.875 TOP10 0.067 0.687 LOCAL 0.220 0.198 CMI 0.025 0.285 GDI -0.026 0.519 LEI 0.038 0.198 ISSUEB -0.265 0.089 ISSUEH -0.262 0.329 EXCHANGE CONTROLLED INDUSTRY CONTROLLED Pseudo R 2 0.1488 p -value <0.001 N 1,340