Category

Code

Definition

Explained Variable

Fee

Audit fee, measured by the natural logarithm of the company’s audit fee

Explaining Variables

Spe

Industry Specialization, measured by the cumulative number of signature of auditor i in industry k before year t

Gender

Gender, is 1 for male auditor and 0 otherwise

Age

Auditor’s age

Edubg

Auditor’s education background, is 1 for bachelor degree or above, and 0 otherwise

Partner

Whether the auditor is partner, is 1 for partner, and 0 otherwise

Exp

Number of audit year, measured by the time of year i deducting the year of registration of CPA

Busyness

Auditor busyness, measured by the total audit tasks of auditor i in year t

Control Variables

Firm’s Characteristics

Opinion

Audit Opinion, is 1 for modified audit opinion, and 0 otherwise

Big 10

Top 10 firms in year i, is 1 for the company which is audited by “big 10”, and 0 otherwise

Switch

Whether switch the firm, is 1 if the company switch the firm, and 0 otherwise

Auditee’s Characteristics

Em

Earnings management, extraordinary item/ absolute value of profit for the year

Complexity

Complexity of economic business, the sum of inventory and account receivables/total asset

Lev

Solvency, asset-liability ratio

Grow

Development capacity, revenue growth rate

Size

Asset size, natural logarithm of total assets at year end

Punish

Governance risk, is 1 if the company is punished by regulators, and 0 otherwise

Loss

Financial risk, iss 1 if profit for the year is positive, and 0 otherwise