The Impact of Partners' Economic Incentives on Audit Quality in Big 4 Partnerships
研究了比利时四大会计师事务所合伙人的费用薪酬和净资产与审计质量的关系，发现费用薪酬负相关、净资产正相关，且债务高的合伙人净资产影响更显著。
ABSTRACT Economic incentives are fundamental for understanding auditor behavior. In this paper, we investigate the association between the extent of partners' fee-based compensation, partners' observable net wealth, and audit quality. Using a sample of Belgian Big 4 audit firms and their predominantly private clients, our results suggest a negative association between audit quality and partner fee-based compensation, and a positive association between audit quality and partner observable net wealth. Moreover, our results show that the latter association is most significant when a partner is carrying a lot of debt, which indicates that a partner's financial situation may affect audit quality. The extent of fee-based incentives also varies among partners of the same audit firm. Furthermore, partner and client characteristics differ based on the extent of fee-based compensation. Our findings should be of interest to regulators and audit firms, as they suggest that audit partners' economic incentives significantly affect audit quality. Data Availability: All data are publicly available from the sources identified in the text. JEL Classifications: M41; M42; D81.