Table 9 Audit committee centrality and...

Table 9

Audit committee centrality and audit opinion in logit model by leverage

Split by	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV
	DEG	DEG	EIGEN	EIGEN	BET	BET	CLOS	CLOS	PCA	PCA	N-SCORE	N-SCORE
CENTRALITY	0.707**	0.232	1.136*	0.346*	0.537**	−0.217	0.103	−0.0938	0.515**	0.0600	1.182***	0.0707
CENTRALITY	(0.353)	(0.181)	(0.599)	(0.208)	(0.219)	(0.155)	(0.112)	(0.0972)	(0.219)	(0.0950)	(0.451)	(0.168)
SIZE	−0.129	−0.786***	−0.0894	−0.765***	0.0483	−0.725***	−0.0258	−0.696***	−0.0854	−0.742***	−0.0165	−0.726***
SIZE	(0.192)	(0.213)	(0.182)	(0.216)	(0.182)	(0.215)	(0.182)	(0.214)	(0.185)	(0.214)	(0.180)	(0.217)
LEV	0.555	−0.627	0.328	−0.746	0.616	−0.586	0.201	−0.385	0.381	−0.719	0.235	−0.706
LEV	(1.700)	(1.760)	(1.655)	(1.745)	(1.762)	(1.753)	(1.653)	(1.790)	(1.722)	(1.744)	(1.730)	(1.746)
ROA	−5.583**	1.001	−5.771**	1.242	−5.173*	1.409	−5.518**	1.130	−5.709**	0.722	−5.828**	0.796
ROA	(2.690)	(3.566)	(2.574)	(3.532)	(2.745)	(3.471)	(2.609)	(3.504)	(2.711)	(3.507)	(2.684)	(3.514)
EXP	1.322	−0.00963	1.089	−0.120	1.034	0.0887	1.080	0.0602	1.252	0.0125	1.002	0.0277
EXP	(0.860)	(0.719)	(0.797)	(0.734)	(0.781)	(0.752)	(0.819)	(0.729)	(0.851)	(0.722)	(0.723)	(0.715)
RECEI	−0.598	−4.404***	−0.198	−4.350***	0.996	−4.587***	0.803	−4.427***	−0.136	−4.457***	0.386	−4.462***
RECEI	(1.861)	(1.397)	(1.842)	(1.392)	(1.922)	(1.396)	(1.853)	(1.413)	(1.787)	(1.408)	(1.810)	(1.410)
LOSS	−1.091**	0.0885	−1.041*	0.0678	−1.005*	0.0748	−1.027*	0.0677	−1.066*	0.0612	−1.016*	0.0642
LOSS	(0.556)	(0.392)	(0.569)	(0.402)	(0.538)	(0.392)	(0.541)	(0.391)	(0.549)	(0.391)	(0.559)	(0.391)
LOSS_t−1	3.179***	2.728***	3.091***	2.678***	3.163***	2.785***	3.186***	2.739***	3.209***	2.741***	3.139***	2.743***
LOSS_t−1	(0.357)	(0.291)	(0.361)	(0.292)	(0.363)	(0.296)	(0.365)	(0.291)	(0.361)	(0.294)	(0.365)	(0.293)
AC_SIZE	−0.123	0.0152	−0.102	0.0165	−0.0513	−0.0122	−0.0913	0.0237	−0.0854	0.0335	−0.0408	0.0336
AC_SIZE	(0.103)	(0.0809)	(0.108)	(0.0800)	(0.103)	(0.0868)	(0.108)	(0.0799)	(0.103)	(0.0813)	(0.104)	(0.0826)
AC_MEET	0.0264	−0.0106	0.0320	−0.0133	0.0290	−0.00950	0.0379	−0.00980	0.0224	−0.00806	0.0373	−0.00917
AC_MEET	(0.0873)	(0.0625)	(0.0911)	(0.0608)	(0.0832)	(0.0604)	(0.0879)	(0.0600)	(0.0853)	(0.0608)	(0.0859)	(0.0605)
B_MEET	−0.114*	0.0245	−0.116*	0.0245	−0.124**	0.0290	−0.146**	0.0243	−0.104*	0.0232	−0.106*	0.0232
B_MEET	(0.0593)	(0.0471)	(0.0622)	(0.0476)	(0.0573)	(0.0453)	(0.0609)	(0.0460)	(0.0570)	(0.0463)	(0.0592)	(0.0460)
B_INDEP	3.008***	2.117***	2.376***	1.890***	2.124***	2.147***	2.165***	2.106***	2.562***	2.133***	2.502***	2.147***
B_INDEP	(0.838)	(0.702)	(0.679)	(0.731)	(0.650)	(0.700)	(0.676)	(0.699)	(0.702)	(0.699)	(0.675)	(0.699)
BIG4	−13.74***	2.647***	−13.33***	2.545***	−14.64***	2.652***	−14.02***	2.543***	−14.65***	2.623***	−14.02***	2.602***
BIG4	(0.678)	(0.494)	(0.624)	(0.489)	(0.724)	(0.515)	(0.641)	(0.503)	(0.693)	(0.499)	(0.700)	(0.496)
AF_t−1	−0.259	0.0724	−0.268*	0.0868	−0.261	0.0821	−0.242	0.0807	−0.261	0.0739	−0.259	0.0785
AF_t−1	(0.165)	(0.187)	(0.160)	(0.183)	(0.168)	(0.185)	(0.162)	(0.183)	(0.166)	(0.184)	(0.167)	(0.184)
RLAW	0.617*	−0.0782	0.534	−0.146	0.612*	−0.0433	0.554	−0.00110	0.651*	−0.0472	0.689*	−0.0409
RLAW	(0.359)	(0.345)	(0.346)	(0.355)	(0.345)	(0.358)	(0.347)	(0.348)	(0.356)	(0.347)	(0.358)	(0.349)
REST_LINKS	−0.108	0.0526	−0.141	0.0397	−0.116	0.0581	−0.107	0.0563	−0.115	0.0621	−0.139	0.0629
REST_LINKS	(0.129)	(0.0973)	(0.127)	(0.0936)	(0.128)	(0.0926)	(0.126)	(0.0955)	(0.127)	(0.0969)	(0.131)	(0.0967)
LINKS_TOTAL	−0.0808	−0.138	0.0423	−0.115	−0.0934	−0.0587	0.0104	−0.0893	−0.126	−0.129	−0.0759	−0.119
LINKS_TOTAL	(0.162)	(0.0905)	(0.117)	(0.0819)	(0.148)	(0.0926)	(0.123)	(0.0886)	(0.164)	(0.0909)	(0.140)	(0.0876)
Intercept	17.02***	4.907	16.96***	4.919	16.25***	3.945	16.40***	3.301	17.84***	4.318	16.58***	4.027
Intercept	(1.840)	(3.050)	(1.931)	(3.051)	(1.913)	(3.010)	(1.756)	(3.016)	(1.863)	(3.008)	(1.877)	(2.985)
Observations	826	891	826	891	826	891	826	891	826	891	826	891
Wald χ²	1196.08	362.69	1341.43	397.56	1195.74	347.36		343.75		350.95	1118.86	349.52
Pseudo R²	0.5498	0.4787	0.5470	0.4823	0.5497	0.4789	0.5410	0.4780	0.5526	0.4775	0.5558	0.4774

Split by	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV	Low LEV	High LEV
	DEG	DEG	EIGEN	EIGEN	BET	BET	CLOS	CLOS	PCA	PCA	N-SCORE	N-SCORE
CENTRALITY	0.707**	0.232	1.136*	0.346*	0.537**	−0.217	0.103	−0.0938	0.515**	0.0600	1.182***	0.0707
CENTRALITY	(0.353)	(0.181)	(0.599)	(0.208)	(0.219)	(0.155)	(0.112)	(0.0972)	(0.219)	(0.0950)	(0.451)	(0.168)
SIZE	−0.129	−0.786***	−0.0894	−0.765***	0.0483	−0.725***	−0.0258	−0.696***	−0.0854	−0.742***	−0.0165	−0.726***
SIZE	(0.192)	(0.213)	(0.182)	(0.216)	(0.182)	(0.215)	(0.182)	(0.214)	(0.185)	(0.214)	(0.180)	(0.217)
LEV	0.555	−0.627	0.328	−0.746	0.616	−0.586	0.201	−0.385	0.381	−0.719	0.235	−0.706
LEV	(1.700)	(1.760)	(1.655)	(1.745)	(1.762)	(1.753)	(1.653)	(1.790)	(1.722)	(1.744)	(1.730)	(1.746)
ROA	−5.583**	1.001	−5.771**	1.242	−5.173*	1.409	−5.518**	1.130	−5.709**	0.722	−5.828**	0.796
ROA	(2.690)	(3.566)	(2.574)	(3.532)	(2.745)	(3.471)	(2.609)	(3.504)	(2.711)	(3.507)	(2.684)	(3.514)
EXP	1.322	−0.00963	1.089	−0.120	1.034	0.0887	1.080	0.0602	1.252	0.0125	1.002	0.0277
EXP	(0.860)	(0.719)	(0.797)	(0.734)	(0.781)	(0.752)	(0.819)	(0.729)	(0.851)	(0.722)	(0.723)	(0.715)
RECEI	−0.598	−4.404***	−0.198	−4.350***	0.996	−4.587***	0.803	−4.427***	−0.136	−4.457***	0.386	−4.462***
RECEI	(1.861)	(1.397)	(1.842)	(1.392)	(1.922)	(1.396)	(1.853)	(1.413)	(1.787)	(1.408)	(1.810)	(1.410)
LOSS	−1.091**	0.0885	−1.041*	0.0678	−1.005*	0.0748	−1.027*	0.0677	−1.066*	0.0612	−1.016*	0.0642
LOSS	(0.556)	(0.392)	(0.569)	(0.402)	(0.538)	(0.392)	(0.541)	(0.391)	(0.549)	(0.391)	(0.559)	(0.391)
LOSS_t−1	3.179***	2.728***	3.091***	2.678***	3.163***	2.785***	3.186***	2.739***	3.209***	2.741***	3.139***	2.743***
LOSS_t−1	(0.357)	(0.291)	(0.361)	(0.292)	(0.363)	(0.296)	(0.365)	(0.291)	(0.361)	(0.294)	(0.365)	(0.293)
AC_SIZE	−0.123	0.0152	−0.102	0.0165	−0.0513	−0.0122	−0.0913	0.0237	−0.0854	0.0335	−0.0408	0.0336
AC_SIZE	(0.103)	(0.0809)	(0.108)	(0.0800)	(0.103)	(0.0868)	(0.108)	(0.0799)	(0.103)	(0.0813)	(0.104)	(0.0826)
AC_MEET	0.0264	−0.0106	0.0320	−0.0133	0.0290	−0.00950	0.0379	−0.00980	0.0224	−0.00806	0.0373	−0.00917
AC_MEET	(0.0873)	(0.0625)	(0.0911)	(0.0608)	(0.0832)	(0.0604)	(0.0879)	(0.0600)	(0.0853)	(0.0608)	(0.0859)	(0.0605)
B_MEET	−0.114*	0.0245	−0.116*	0.0245	−0.124**	0.0290	−0.146**	0.0243	−0.104*	0.0232	−0.106*	0.0232
B_MEET	(0.0593)	(0.0471)	(0.0622)	(0.0476)	(0.0573)	(0.0453)	(0.0609)	(0.0460)	(0.0570)	(0.0463)	(0.0592)	(0.0460)
B_INDEP	3.008***	2.117***	2.376***	1.890***	2.124***	2.147***	2.165***	2.106***	2.562***	2.133***	2.502***	2.147***
B_INDEP	(0.838)	(0.702)	(0.679)	(0.731)	(0.650)	(0.700)	(0.676)	(0.699)	(0.702)	(0.699)	(0.675)	(0.699)
BIG4	−13.74***	2.647***	−13.33***	2.545***	−14.64***	2.652***	−14.02***	2.543***	−14.65***	2.623***	−14.02***	2.602***
BIG4	(0.678)	(0.494)	(0.624)	(0.489)	(0.724)	(0.515)	(0.641)	(0.503)	(0.693)	(0.499)	(0.700)	(0.496)
AF_t−1	−0.259	0.0724	−0.268*	0.0868	−0.261	0.0821	−0.242	0.0807	−0.261	0.0739	−0.259	0.0785
AF_t−1	(0.165)	(0.187)	(0.160)	(0.183)	(0.168)	(0.185)	(0.162)	(0.183)	(0.166)	(0.184)	(0.167)	(0.184)
RLAW	0.617*	−0.0782	0.534	−0.146	0.612*	−0.0433	0.554	−0.00110	0.651*	−0.0472	0.689*	−0.0409
RLAW	(0.359)	(0.345)	(0.346)	(0.355)	(0.345)	(0.358)	(0.347)	(0.348)	(0.356)	(0.347)	(0.358)	(0.349)
REST_LINKS	−0.108	0.0526	−0.141	0.0397	−0.116	0.0581	−0.107	0.0563	−0.115	0.0621	−0.139	0.0629
REST_LINKS	(0.129)	(0.0973)	(0.127)	(0.0936)	(0.128)	(0.0926)	(0.126)	(0.0955)	(0.127)	(0.0969)	(0.131)	(0.0967)
LINKS_TOTAL	−0.0808	−0.138	0.0423	−0.115	−0.0934	−0.0587	0.0104	−0.0893	−0.126	−0.129	−0.0759	−0.119
LINKS_TOTAL	(0.162)	(0.0905)	(0.117)	(0.0819)	(0.148)	(0.0926)	(0.123)	(0.0886)	(0.164)	(0.0909)	(0.140)	(0.0876)
Intercept	17.02***	4.907	16.96***	4.919	16.25***	3.945	16.40***	3.301	17.84***	4.318	16.58***	4.027
Intercept	(1.840)	(3.050)	(1.931)	(3.051)	(1.913)	(3.010)	(1.756)	(3.016)	(1.863)	(3.008)	(1.877)	(2.985)
Observations	826	891	826	891	826	891	826	891	826	891	826	891
Wald χ²	1196.08	362.69	1341.43	397.56	1195.74	347.36		343.75		350.95	1118.86	349.52
Pseudo R²	0.5498	0.4787	0.5470	0.4823	0.5497	0.4789	0.5410	0.4780	0.5526	0.4775	0.5558	0.4774

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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