Table 3 Results of OLS on the...

Table 3

Results of OLS on the relationship between audit quality, specifically Audit Tenure (AT), Audit Fees (AF), and Audit Size (B5), And Financial Statement Fraud (FR)

Variable	Coefficient	t-Statistic	Prob
AT	−0.661	−2.344	0.0197**
B5	0.626	0.793	0.429
AF	0.539	2.590`	0.010**
Prof	−3.362	−2.25	0.025**
Lev	0.138	1.874	0.0618*
ROA	13.335	7.459	0.000***
Size	7.688	14.058	0.000***
Adj R²	0.29
F-stat	2.417
D-W	2.83

Variable	Coefficient	t-Statistic	Prob
AT	−0.661	−2.344	0.0197**
B5	0.626	0.793	0.429
AF	0.539	2.590`	0.010**
Prof	−3.362	−2.25	0.025**
Lev	0.138	1.874	0.0618*
ROA	13.335	7.459	0.000***
Size	7.688	14.058	0.000***
Adj R²	0.29
F-stat	2.417
D-W	2.83

Note(s):

${F R}_{i t} = β_{0} + β_{1} {A T}_{i t} + B_{2} {A F}_{i t} + B_{3} {B 5}_{i t} + B_{4} {P R O F}_{i t} + B_{5} {L e v}_{i t} + B_{6} {S i z e}_{i t} + B_{7} {R o a}_{i t} + \in_{i t}$

*, **, *** Represent significance at the 10, 5, and 1 percent levels, respectively. FR is Dechow f-value, AT is auditor period; Big5 is five big audit firms (Deloitte, KPMG, Enrst and Young, PWC, BDO); AF is the amount paid for the auditor service; Prof is profitability measured by net profit margin, Lev is a leverage of the company is measured by total assets divided by total liabilities of the company, ROA is return on assets is measured by income continuing operation divided by total assets; Size that is measured by the total assets of the company. White robust standard errors are used to control for heteroscedasticity

Source(s): Table created by authors

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