Table 7 Audit committee centrality and...

Table 7

Audit committee centrality and audit opinion in probit model

	DEG	EIGEN	BET	CLOS	PCA	N-SCORE
CENTRALITY	0.188**	0.198**	0.0898	−0.0300	0.218**	0.112**
CENTRALITY	(0.0864)	(0.0891)	(0.0575)	(0.0405)	(0.0870)	(0.0477)
SIZE	−0.217***	−0.207***	−0.179**	−0.181**	−0.192***	−0.207***
SIZE	(0.0718)	(0.0710)	(0.0721)	(0.0712)	(0.0715)	(0.0715)
LEV	0.732*	0.676	0.749*	0.739*	0.635	0.708
LEV	(0.445)	(0.441)	(0.446)	(0.444)	(0.441)	(0.443)
ROA	−1.388	−1.316	−1.483	−1.356	−1.378	−1.526
ROA	(1.286)	(1.274)	(1.274)	(1.270)	(1.278)	(1.283)
EXP	0.0868	−0.00677	0.0836	0.104	0.0308	0.0485
EXP	(0.286)	(0.292)	(0.281)	(0.287)	(0.286)	(0.288)
RECEI	−1.518**	−1.478**	−1.417**	−1.447**	−1.461**	−1.457**
RECEI	(0.653)	(0.667)	(0.674)	(0.670)	(0.674)	(0.670)
LOSS	−0.184	−0.198	−0.192	−0.190	−0.179	−0.193
LOSS	(0.171)	(0.174)	(0.170)	(0.170)	(0.172)	(0.172)
LOSS_t−1	−0.0942	−0.0934	−0.0942	−0.0844	−0.116	−0.108
LOSS_t−1	(0.154)	(0.152)	(0.151)	(0.152)	(0.153)	(0.154)
CLEAN_t−1	1.762***	1.739***	1.766***	1.770***	1.753***	1.761***
CLEAN_t−1	(0.123)	(0.123)	(0.124)	(0.124)	(0.123)	(0.123)
AC_SIZE	0.0206	0.0215	0.0444	0.0318	0.0386	0.0332
AC_SIZE	(0.0323)	(0.0324)	(0.0323)	(0.0318)	(0.0321)	(0.0319)
AC_MEET	−0.00528	−0.00410	−0.00119	−0.00270	−0.00306	−0.00237
AC_MEET	(0.0280)	(0.0276)	(0.0270)	(0.0272)	(0.0273)	(0.0274)
B_MEET	−0.00402	−0.00500	−0.00734	−0.00777	−0.00566	−0.00502
B_MEET	(0.0193)	(0.0194)	(0.0191)	(0.0192)	(0.0192)	(0.0190)
B_INDEP	1.073***	0.941***	0.962***	0.947***	1.008***	1.001***
B_INDEP	(0.278)	(0.265)	(0.260)	(0.261)	(0.263)	(0.265)
BIG4	0.791***	0.776***	0.792***	0.791***	0.768***	0.796***
BIG4	(0.216)	(0.210)	(0.215)	(0.214)	(0.212)	(0.215)
AF_t−1	−0.0442	−0.0353	−0.0393	−0.0343	−0.0338	−0.0430
AF_t−1	(0.0658)	(0.0628)	(0.0636)	(0.0627)	(0.0639)	(0.0647)
RLAW	0.142	0.114	0.163	0.155	0.137	0.139
RLAW	(0.123)	(0.125)	(0.122)	(0.122)	(0.121)	(0.121)
REST_LINKS	−0.00855	−0.00840	−0.00434	−0.00615	−0.00523	−0.00523
REST_LINKS	(0.0393)	(0.0391)	(0.0389)	(0.0383)	(0.0393)	(0.0392)
LINKS_TOTAL	−0.0565	−0.0343	−0.0494	−0.0218	−0.0555	−0.0650
LINKS_TOTAL	(0.0393)	(0.0343)	(0.0395)	(0.0352)	(0.0370)	(0.0405)
Intercept	1.237	1.119	0.506	0.531	0.867	1.117
Intercept	(0.990)	(0.973)	(0.964)	(0.949)	(0.961)	(0.977)
Observations	1,757	1,757	1,757	1,757	1,757	1,757
R²	0.4739	0.4749	0.4717	0.4707	0.4741	0.4736
Correctly classified (%)	88.39	88.33	88.16	87.93	88.22	88.28

	DEG	EIGEN	BET	CLOS	PCA	N-SCORE
CENTRALITY	0.188**	0.198**	0.0898	−0.0300	0.218**	0.112**
CENTRALITY	(0.0864)	(0.0891)	(0.0575)	(0.0405)	(0.0870)	(0.0477)
SIZE	−0.217***	−0.207***	−0.179**	−0.181**	−0.192***	−0.207***
SIZE	(0.0718)	(0.0710)	(0.0721)	(0.0712)	(0.0715)	(0.0715)
LEV	0.732*	0.676	0.749*	0.739*	0.635	0.708
LEV	(0.445)	(0.441)	(0.446)	(0.444)	(0.441)	(0.443)
ROA	−1.388	−1.316	−1.483	−1.356	−1.378	−1.526
ROA	(1.286)	(1.274)	(1.274)	(1.270)	(1.278)	(1.283)
EXP	0.0868	−0.00677	0.0836	0.104	0.0308	0.0485
EXP	(0.286)	(0.292)	(0.281)	(0.287)	(0.286)	(0.288)
RECEI	−1.518**	−1.478**	−1.417**	−1.447**	−1.461**	−1.457**
RECEI	(0.653)	(0.667)	(0.674)	(0.670)	(0.674)	(0.670)
LOSS	−0.184	−0.198	−0.192	−0.190	−0.179	−0.193
LOSS	(0.171)	(0.174)	(0.170)	(0.170)	(0.172)	(0.172)
LOSS_t−1	−0.0942	−0.0934	−0.0942	−0.0844	−0.116	−0.108
LOSS_t−1	(0.154)	(0.152)	(0.151)	(0.152)	(0.153)	(0.154)
CLEAN_t−1	1.762***	1.739***	1.766***	1.770***	1.753***	1.761***
CLEAN_t−1	(0.123)	(0.123)	(0.124)	(0.124)	(0.123)	(0.123)
AC_SIZE	0.0206	0.0215	0.0444	0.0318	0.0386	0.0332
AC_SIZE	(0.0323)	(0.0324)	(0.0323)	(0.0318)	(0.0321)	(0.0319)
AC_MEET	−0.00528	−0.00410	−0.00119	−0.00270	−0.00306	−0.00237
AC_MEET	(0.0280)	(0.0276)	(0.0270)	(0.0272)	(0.0273)	(0.0274)
B_MEET	−0.00402	−0.00500	−0.00734	−0.00777	−0.00566	−0.00502
B_MEET	(0.0193)	(0.0194)	(0.0191)	(0.0192)	(0.0192)	(0.0190)
B_INDEP	1.073***	0.941***	0.962***	0.947***	1.008***	1.001***
B_INDEP	(0.278)	(0.265)	(0.260)	(0.261)	(0.263)	(0.265)
BIG4	0.791***	0.776***	0.792***	0.791***	0.768***	0.796***
BIG4	(0.216)	(0.210)	(0.215)	(0.214)	(0.212)	(0.215)
AF_t−1	−0.0442	−0.0353	−0.0393	−0.0343	−0.0338	−0.0430
AF_t−1	(0.0658)	(0.0628)	(0.0636)	(0.0627)	(0.0639)	(0.0647)
RLAW	0.142	0.114	0.163	0.155	0.137	0.139
RLAW	(0.123)	(0.125)	(0.122)	(0.122)	(0.121)	(0.121)
REST_LINKS	−0.00855	−0.00840	−0.00434	−0.00615	−0.00523	−0.00523
REST_LINKS	(0.0393)	(0.0391)	(0.0389)	(0.0383)	(0.0393)	(0.0392)
LINKS_TOTAL	−0.0565	−0.0343	−0.0494	−0.0218	−0.0555	−0.0650
LINKS_TOTAL	(0.0393)	(0.0343)	(0.0395)	(0.0352)	(0.0370)	(0.0405)
Intercept	1.237	1.119	0.506	0.531	0.867	1.117
Intercept	(0.990)	(0.973)	(0.964)	(0.949)	(0.961)	(0.977)
Observations	1,757	1,757	1,757	1,757	1,757	1,757
R²	0.4739	0.4749	0.4717	0.4707	0.4741	0.4736
Correctly classified (%)	88.39	88.33	88.16	87.93	88.22	88.28

Note(s): Estimated coefficients (std. errors) using the logit regression of equation (2). The dependent variable is CLEAN in all the regressions. The first row indicates the centrality measure used. All the estimations include year and industry-fixed effects and clustering by firm. See Appendix I for the definition of the variables. ***, **, * for 1%, 5% and 10% significance level

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