Institutional Arrangements and Government Audit Independence in China

• Jason Zezhong Xiao ^[1] ; Suchang Yang ^[2] ; Xinmin Zhang ^[3] ; Michael Firth ^[4]
  1. [1] Cardiff University

     Cardiff University

     Castle, Reino Unido

     
  2. [2] Lanzhou University

     Lanzhou University

     China

     
  3. [3] University of International Business and Economics

     University of International Business and Economics

     China

     
  4. [4] Lingnan University

     Lingnan University

     RAE de Hong Kong (China)

     

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• Localización: Abacus: A journal of accounting, finance and business studies, ISSN 0001-3072, Vol. 52, Nº 3, 2016, págs. 532-567
• Idioma: inglés
• Texto completo no disponible (Saber más ...)
• Resumen

  • China has adopted an executive-dominated government audit system (GAS), which is frequently criticized for lacking independence. Through a questionnaire survey and interviews, we investigate whether and how the reporting/control requirements of the GAS (hereafter, the institutional arrangements) result in a lack of government audit independence in China and how this affects budget supervision by the People's Congress. We contribute field evidence to support the prediction that an executive-dominated GAS lacks independence and transparency, which in turn is detrimental to the wider accountability regime. However, the specific level of independence varies according to the types and levels of government audit. Our findings enrich the government audit literature, enhance our understanding of the relationship between institutional arrangements and audit independence in a transition economy, and serve as a call for institutional reform relating to the Chinese GAS.