Philanthropy,Media Attention And Audit Fees

Unlike financial data,non-financial information such as corporate social responsibility practices is not easily manipulated through extensive media coverage.As a high-level manifestation of social responsibility,charitable donation can provide auditors with more authentic corporate information,thus contributing to the evaluation of financial information and helping auditors to more accurately grasp the overall performance,risks and development prospects of enterprises.Companies that actively make charitable donations usually have a sound management system and internal control system.The management is more socially responsible and can provide higher quality financial reports.Some scholars also believe that the active philanthropic donation behavior of enterprises has diverted investors’ attention and concealed the inherent lack of social responsibility such as illegal or manipulated surplus.Companies with good CSR performance increase the auditor’s audit difficulty and audit risk.This paper first describes the basic concept of research needs.Then,the basic theories of information asymmetry,principal-agent,audit demand insurance and impression management are reviewed.Then,based on the summary of existing literature,this paper analyzes the impact path of charitable donations on audit costs,discusses the impact of media attention on audit costs,and the impact of media attention on the relationship between charitable donations and audit costs,and puts forward corresponding hypotheses.This paper takes a-share listed companies from 2008 to 2018 as the research samples,conducts empirical tests on the research hypothesis,and conducts robustness tests in various ways,such as changing measurement methods,variable adjustment,considering the lag term of variables,and adjusting standard errors,to ensure the robustness of the results.In addition,this paper also makes a further analysis to explore the impact of different nature of charitable donations on audit costs.The results of this paper show that there is a positive correlation between corporate charitable donation and audit fee,and the higher the amount of corporate charitable donation,the higher the audit fee.Media attention is positively correlated with audit cost.The higher the media attention,the higher the audit cost.Media attention has a positive moderating effect on the correlation between corporate charitable donations and audit fees.In addition,after distinguishing different types of charitable donations,compared with enterprises with higher level stability of charitable donations,enterprises with lower level stability of charitable donations have a more significant positive correlation with audit expenses.Compared with strategic charitable giving,the positive correlation between self-serving charitable giving and audit expenses is more significant.Finally,this paper summarizes the research results and limitations,provides relevant policy and management suggestions,and points out possible research directions in the future.