The Spillover Effect of Audit Firm Office Acquisition on the Audit Quality of the Existing Client Base
研究审计事务所分所收购后，收购方分所对现有客户的审计质量是否提升，利用2002年安达信被收购事件，发现收购后审计质量显著提高。
SYNOPSIS This study investigates accounting firm office acquisitions. It explores whether office acquisitions affect post-acquisition office audit quality, particularly whether there is a spillover effect on the existing client base of the acquiring office. We capitalize on a unique circumstance: the 2002 acquisition of Arthur Andersen (Andersen) offices by other audit firms. This setting involves a set of offices in each of the remaining large international audit firms that acquired entire Andersen local practices and a set of offices that did not acquire Andersen practices. Using a within-audit firm matched sample and a difference-in-differences research design, we find robust evidence of higher audit quality post-acquisition among the audits of existing clients of the acquiring offices. These findings extend the literature on office audit quality and provide initial evidence of the impact of audit firm office acquisitions on the existing client base. Data Availability: Data are available from public sources noted in the text. JEL Classifications: M42.