The Investment of Enterprises ＂From Real to Virtual＂,Internal and External Governance Mechanisms and Audit Pricing-Empirical Evidence from Chinese A-share listed companies
The current economic development in China is characterized by a significant structural contradiction known as the＂de-realization to virtual＂of enterprise investments.Timely auditing can help identify potential risks and adverse effects of this phenomenon,ultimately impacting pricing.It is worthwhile to delve into it thoroughly.Selecting China Shanghai and Shenzhen A-share non-financial listed companies from 2013 to 2021 as the research sample,this study comprehensively utilizes panel regression models to explore the impact and action path of enterprises'investment behavior ＂from real to virtual＂on audit pricing.The research findings are as follows:(1)Transitioning corporate investment from real to virtual will lead to higher audit pricing;(2)Internally,shifting investment behavior from real to virtual significantly raises agency costs,complicates and increases risk for audit services,and encourages auditors to charge higher fees;(3)Externally,analysts'focus partially contributes to spreading the negative effects of companies'shift towards virtual investment behavior,impacting stock prices and increasing auditors'risk perception,thus bolstering the positive impact of virtual investment behavior on audit pricing.The conclusions stated above are strong and sound.The extended study discovered that the impact of analysts'focus on the mediation of agency costs is influenced by auditors'attentiveness to companies'investment decisions shifting ＂from physical to online＂is more pronounced in state-owned enterprises,as well as in central and western regions and companies facing high financial constraints.Hence,there is a suggestion for the government to enhance market system development and reinforce financial monitoring and control;for companies to improve asset distribution and prevent illogical investment actions;for the auditing sector to boost risk awareness and uphold professional caution;for the analyst field to enhance analysts'expertise and establish a more comprehensive analyst market system.The ultimate research finding offers a fresh viewpoint for government regulatory bodies,businesses,and audit service providers to grasp the investment shift ＂from tangible to digital＂,and presents tangible proof for the enhancement and advancement of enterprises and audit service excellence.
investment ＂from real to virtual＂audit pricinggovernance mechanismagency problemanalysts'attention
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