Abstract:

With the improvement of environmental protection requirements and ecological civilization constructions, local governments have enacted large numbers of environmental regulations. Enterprises in heavy pollution industries, as the main object of environmental governance, are facing higher environmental violation risks. Under the modern risk-oriented audit mode, environmental violation risks affect audit fees. Meanwhile, the previous environmental investment can help enterprises to improve their reputation, innovation, competitiveness, and ability to resist risks, which may have an insurance-like effect to alleviate the effect of environmental regulations on audit fees. Although some studies have examined the effect of environmental regulations on audit fees, there is still a lack of attention on whether the previous environmental investment and heterogeneous environmental investment strategies can alleviate this effect.
Based on the modern risk-oriented audit mode and the insurance-like effect of the previous environmental investment, taking Chinese A-share listed companies in heavy pollution industries from 2012 to 2017 as the sample, this study empirically tests the effect of environmental regulations on audit fees and the moderating effects of heterogeneous environmental investment strategies. This study further explores the mechanism of the environmental investment in alleviating the effect of environmental regulations on audit fees under different corporate natures, information transparency, and auditor tenures. The empirical results show that local environmental regulations are significantly positively associated with audit fees. The previous environmental capital expenditures negatively moderate the positive correlation, indicating that the environmental capital expenditures can alleviate the effect of environmental regulations on audit fees. Yet the environmental revenue expenditures do not have the same moderating effect. The results are confirmed to be robust after endogenous tests and alternative variables tests. Further mechanism analysis suggests that in local state-owned enterprises, non-state-owned enterprises, and enterprises with low information transparency and shorter auditor tenure, the moderating effect of environmental capital expenditures is more significant.
The theoretical contribution and practical value are as follows: Firstly, unlike previous studies that only test the effect of environmental regulations on audit fees, this study further verifies the moderating effect of enterprises’ previous environmental investment; Secondly, this study divides the environmental investment into capital expenditures and revenue expenditures, and then tests the different moderating effects of heterogeneous environmental investment strategies. Therefore, this study reveals the effect of environmental regulations on audit fees and suggests that enterprises’ environmental investment can serve as a risk management tool. The conclusion has reference value for the adjustment of audit behaviors and the optimization of enterprises’ environmental investment strategies under strict environmental regulations.
The conclusion shows that enterprises’ environmental investment can not only promote the environmental governance but also enhance the ability to resist risks. Therefore, this study puts forward the following suggestions: First, local governments should strengthen the implementation of environmental regulations when improving the economic development. Second, enterprises should increase their environmental investment, optimize their environmental investment strategies, and increase the environmental capital expenditures instead of environmental revenue expenditures. In addition, auditors should pay more attention to the effect of environmental regulations on enterprises, and understand the different roles of heterogeneous environmental investment strategies in dealing with environmental violation risks.

Key words: Environmental Regulation, Audit Fees, Environmental Investment, Heterogeneity

摘要：

本文以我国重污染行业上市公司为样本,结合各地环境法规和规章及上市公司环保投入资本性支出和费用性支出等数据,进行实证研究发现:地方环境法规和规章数显著影响上市公司审计费用,二者正相关;上市公司前期“投资预防型”环保投入负向调节二者之间的正相关关系,表明“投资预防型”环保投入能够缓解环境规制对审计费用的影响,但“费损清偿型”环保投入不具备这种调节作用。本文创新性地划分并检验了异质性企业环保投入策略在缓解环境规制影响中的不同作用,揭示了环境规制影响审计费用以及企业环保投入可以作为一种风险管理工具的作用机制,对环境规制下审计行为的调整和企业环保行为的优化具有参考价值。

关键词: 环境规制, 审计费用, 环保投入, 异质性