The Determinant Factors of auditor switch among companies listed on Tehran Stock Exchange

Abstract

Regarding to the impact of auditor switching on auditor’s independence, this issue become an important subject and widely studied in developed countries recently. In spite of the growing concerns of this issue, few studies have been done in Iran to investigate which factors influenced auditor switch. The aim of this research is to find major determinants of auditor switch among companies listed on Tehran stock exchange. In order to verify the determinants of auditor switch, logistic regression model is used in this study. The Sample consists of 182 companies that listed on Tehran Stock Exchange (TSE). From these 182 companies, 91 companies had auditor switch during 2003 till 2007 and 91 companies without auditor switch. The results indicate that between 6 factors that are analyzed in this research only auditor size is significantly related to auditor switch among companies listed on Tehran Stock Exchange. Furthermore, consistent with previous studies, this study showed that there is no significant relationship between receiving qualified audit opinion and auditor switch. Thus, this result suggests that opinion shopping is not a concern in TSE.