동질적 성격의 산업에 속한 피감기업을 감사하는 감사인의 산업전문성이 감사인의 행동에 미치는 영향

Several prior studies document the favorable effect of industry expertise auditor, such as the synergy effect of the audit or economy of scale, which leads to reduced audit efforts while maintaining similar level of audit quality. However, there exist only a few studies that examine the effect of industry specialist auditor in Korea. In this study, we examine whether the effect of the auditor industry expertise is more pronounced when auditing several client firms belonging to relatively homogenous industries in which audit processes could be more transferable among the firms. Using 13,843 firm-year observations collected over 2005 – 2016 period in Korean stock market, we empirically analyze these predictions using regression approaches. Our findings are summarized as follows: First, we find that there is no significant change in the audit fees for homogenous clients of the industry expert auditor. Second, however, interestingly, we find that audit hour decreases for such clients of the industry expert auditor but audit fee per hour increases, resulting in no change in the total audit fee. Third, we fail to find any evidence that audit quality is affected for the general sample, However, when we restrict the samples to the clients of Big 4 auditors, we find evidence that audit quality improves marginally or it does not change when industry expert auditor audits clients in homogenous industries. In summary, these findings suggest that industry expert auditors can provide high-quality or similar-quality audit service with relatively low costs. These findings could be due to following two reasons: the assignment of more experienced staffs or the occurrence of audit efficiency. However, we acknowledge that our findings do not resolve the questions why these changes occur exactly.