Definition of variables
| Variable | Definition |
|---|---|
| Tax avoidance | It is the ratio of ETR to STR |
| Specialist | It is an indicator variable that is equal to one if the ratio of the total fees collected by the auditor for the industry to the total fees collected is the highest and zero otherwise (Jha and Chen, 2014) |
| Audit tenure | the number of consecutive years that an audit firm undertakes the responsibility of a company’s auditing (Myers et al., 2003) |
| Audit opinion | It equals one if the auditor issues an unqualified opinion without any additional language and zero otherwise (Jha and Chen, 2014) |
| Audit fee | It is the natural logarithm of the total audit fee of the external auditor (Jha and Chen, 2014) |
| Days to sign | It is the logarithm of lag between the signature date of the audit opinion and the date of fiscal year-end (Jha and Chen, 2014) |
| Accruals | It is defined as the absolute value of total accruals scaled by total assets (Bryan and Mason, 2016) |
| Firm size | It is the natural logarithm of the total assets of a company (Salehi, Tarighi and Rezanezhad, 2018) |
| ROA | Return on Assets is calculated by dividing a company’s annual earnings by its total assets (Salehi, Tahervafaei and Tarighi, 2018) |
| Dividend | It is the natural logarithm of a payment made by a corporation to its shareholders, usually as a distribution of profits |
| Firm age | It is the logarithm of the number of years since the company has been listed on the Tehran Stock Exchange (Salehi, Tahervafaei and Tarighi, 2018) |
| Leverage | It is calculated through long-term debt scaled by total assets (Salehi, Tahervafaei and Tarighi, 2018) |
| Loss | It is an indicator variable which equals one if the net income is negative and, zero otherwise (Salehi, Tahervafaei and Tarighi, 2018) |
| Industry indicator | It is based on the two-digit SIC code |
| Variable | Definition |
|---|---|
| Tax avoidance | It is the ratio of ETR to STR |
| Specialist | It is an indicator variable that is equal to one if the ratio of the total fees collected by the auditor for the industry to the total fees collected is the highest and zero otherwise ( |
| Audit tenure | the number of consecutive years that an audit firm undertakes the responsibility of a company’s auditing ( |
| Audit opinion | It equals one if the auditor issues an unqualified opinion without any additional language and zero otherwise ( |
| Audit fee | It is the natural logarithm of the total audit fee of the external auditor ( |
| Days to sign | It is the logarithm of lag between the signature date of the audit opinion and the date of fiscal year-end ( |
| Accruals | It is defined as the absolute value of total accruals scaled by total assets ( |
| Firm size | It is the natural logarithm of the total assets of a company ( |
| ROA | Return on Assets is calculated by dividing a company’s annual earnings by its total assets ( |
| Dividend | It is the natural logarithm of a payment made by a corporation to its shareholders, usually as a distribution of profits |
| Firm age | It is the logarithm of the number of years since the company has been listed on the Tehran Stock Exchange ( |
| Leverage | It is calculated through long-term debt scaled by total assets ( |
| Loss | It is an indicator variable which equals one if the net income is negative and, zero otherwise ( |
| Industry indicator | It is based on the two-digit SIC code |
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