Presenting a comprehensive model for predicting the type of audit opinion from machine learning algorithms: Evidence from Tehran Stock Exchange

[1] M. Abbaszadeh, M. Muftoonian, M. Babaei Kalarijani, and M. Fadaei, Investigating the accuracy of heuristic algorithms and logit linear regression in predicting the type of independent auditor’s opinion, Quart. J. Modern Res. Account. Audit. 1 (2016), no. 4, 39–73.

[2] A. Ahmadpour, A.A. Taher Abadi, and S. Abbasi, The effect of financial and non-financial variables on the issuance of conditional audit opinion (companies admitted to the Tehran Stock Exchange), Stock Exchange J. 3 (2009), no. 9.

[3] H.K. Alkdai and M.M. Hanefah, Board of directors’ characteristics and value relevance of accounting information in Malaysian shariah-compliant companies: A panel data analysis, Econ. Finance Rev. 2 (2012), no. 6, 31–44.

[4] O. Amri, M. Shurvarzi, A. Masihabadi and A.R. Mehr Azin, The role of management characteristics on the type of audit opinion and auditor-employer equations, Audit Knowledge 21 (2021), no. 83, 246–266.

[5] T. Averio, The analysis of influencing factors on the going concern audit opinion–a study in manufacturing firms in Indonesia, Asian J. Account. Res. 6 (2020), no. 2, 152–164.

[6] T.B. Bell and R.H. Tabor, Empirical analysis of audit uncertainty qualifications, J. Account. Res. 29 (1991), no. 2, 350–370.

[7] B.M. Blau, T.J. Brough, and T.G. Griffith, Bank opacity and the efficiency of stock prices, Journal of Banking & Finance, 76 (2017), 32–47.

[8] J.L. Callen, M. Khan, and H. Lu, Accounting quality, stock price delay, and future stock returns, Contemp. Account. Res. 30 (2013), no. 1, 269–295.

[9] C. Cao, B. Liang, A.W. Lo, and L. Petrasek, Hedge fund holdings and stock market efficiency, Rev. Asset Pric. Stud. 8 (2018), no. 1, 77–116.

[10] K.C.W. Chen and B.K. Church, Default on debt obligations and the issuance of going-concern opinions, Audit.: J. Practice Theory 11 (1992), no. 2.

[11] J. Chen, W. Dong, S. Li, and Y. Zhang, Perceived audit quality, state ownership, and stock price delay: Evidence from China, Asia-Pac. J. Account. Econ. 25 (2018), no. 1–2, 253–275.

[12] L.R. Chen and H.L. Tao, Empirical research on the impact of product market competition on internal control quality, China Acad. J. 2013 (2013), 52–59.

[13] L.E. DeAngelo, Auditor size and audit quality, J. Account. Econ. 3 (1981), no. 3, 183–199.

[14] P.M. Dechow, R.G. Sloan, and A.P. Sweeney, Detecting earnings management, Account. Rev. 70 (1995), no. 2, 193–225.

[15] S. Dua and X. Du, Data Mining and Machine Learning in Cybersecurity, CRC Press, 2016.

[16] A. Faizizadeh, The effect of audit evidence on the auditor’s report, Account. Knowledge Manag. Audit Quart. 38 (2021), 159–166.

[17] H. Fakhari and I. Amiri, Causes and consequences of purchasing an auditor’s opinion, Account. Audit. Stud. 9 (2019), no. 36, 5–26.

[18] J. Faruzandeh, N. Izadinia, and S. Daie Karimzadeh, The effect of the severity of financial statement renewal on the type of auditor’s opinion and the paragraphs of the audit report (evidence of the quality of financial statements), Audit. Knowledge 82 (2021), no. 4, 298–321.

[19] J. Francis, R. LaFond, P.M. Olsson, and K. Schipper, Costs of equity and earnings attributes, Account. Rev. 79 (2004), no. 4, 967–1010.

[20] J. Francis, P. Olsson, and K. Schipper, Earnings quality, Foundations and Trends® in Accounting, 1 (2008), no. 4, 259–340.

[21] M. Golmohammadi Shuraki, O. Pourheidari, and M. Azizkhani, Accounting comparability, financial reporting quality and audit opinions: evidence from Iran, Asian Rev. Account. 29 (2021), no. 1, 42–60.

[22] A. Habib, A.H. Muhammadi, and H. Jiang, Political connections, related party transactions, and auditor choice: Evidence from Indonesia, J. Contemp. Account. Econ. 13 (2017), no. 1, 1–19.

[23] S.A. Hashemi, S. Farahmand, and N. Jashouqani, The effect of conditional conservatism on cost of equity capital, Iran. J. Account. Knowledge 7 (2011), 20.

[24] Z. He, D. Chen and J. Tang, Do goodwill impairments affect audit opinions? Evidence from China, China J. Account. Res. 14 (2021), no. 2, 151–182.

[25] R. Jamei and N. Lotfijo, The effect of political communication on the auditor’s opinion with an emphasis on the market characteristics of Tehran Stock Exchange companies, Karafan Sci. Quart. 18 (2022), no. 2, 55–72.

[26] J. Jones, Earnings management during import relief investigations, J. Account. Res. 29 (1991), 193–228.

[27] S. Khajavi, M. Kazem Nejad, A.A. Dehghani Saadi, and A. Mumtazian, Investigating the usefulness of different methods of selecting predictor variables in predicting the type of auditors’ comments, Exper. Account. Rese. 7 (2017), no. 27, 81–102.

[28] S. Khajavi, G. Mohsenifard, G. Rezaei, and S.D. Hosseini Rad, Investigating the effects of competition in the product market on the profit management of companies listed in the Tehran Stock Exchange, Sci.-Res. Quart. Asset Manage. Financ. 1 (2012), no. 3, 119–134.

[29] J.B. Kim, Z. Yu and H. Zhang, Can media exposure improve stock price efficiency in China and why?, China J. Account. Res. 9 (2016), no. 2, 83–114.

[30] E. Kirkos, C. Spathis, A. Nanopoulos, and Y. Manolopoulos, Identifying qualified auditors’ opinions: a data mining approach, J. Emerg. Technol. Account. 4 (2007), no. 1, 183–197.

[31] G. Kordestani and Z. Majdi, Investigation of the relationship between quantitative return attributes and the expected return rate of common stock investors, Account. Audit. Investigations 14 (2007), no. 48, 85–104.

[32] R. Kormendi and R. Lipe, Earnings innovations, earnings persistence, and stock returns, J. Bus. 60 (1987), no. 3, 323–345.

[33] E. Koskivaara, Artificial neural networks in analytical review procedures, Manage. Audit. J. 19 (2004), no. 2, 191–223.

[34] C. Leuz, D. Nanda, and P.D. Wysocki, Earnings management and investor protection: an international comparison, J. Financ. Econ. 69 (2003), no. 3, 505–527.

[35] F. Li, I. Abeysekera, and S. Ma, Earnings management and the effect of earnings quality in relation to stress level and bankruptcy level of Chinese listed firms, Corp. Ownership Control 9 (2011), no. 1, 366–391.

[36] F. Mohammad Rezaei, Z. Dayanti Deilmi, and R. Darvand, The type of audit report, the number and type of condition clauses of the conditional audit report: the role of the economic crisis, Knowledge Account. Manage. Audit, 9 (2019), no. 33, 25–39.

[37] M. Namazi and S. Ebrahimi, Investigating the relationship between product market’s competitive structure and stock return of the listed companies on the Tehran Stock Exchange, Financ. Account. Knowledge 2 (2012), no. 3, 9–27.

[38] D.P. Newman, E.R. Patterson, and J.R. Smith, The role of auditing in investor protection, Account. Rev. 80 (2005), no. 1, 289–313.

[39] A. Nikkhah Azad, Statement of the basic concepts of auditing, Issued by the committee responsible for developing statements of fundamental auditing concepts of the American Accounting Association (AAA), Tehran: Audit Organization, Audit Guidelines Development Committee Publication, 2000.

[40] S.H. Penman and X.-J. Zhang, Accounting conservatism, the quality of earnings, and stock returns, Account. Rev. 77 (2002), no. 2, 237–264.

[41] O. Pourheidari and Z. Azami, Identification of auditors’ comments using neural networks, J. Account. Knowledge 3 (2009), 77–97.

[42] M. Qian, P.-W. Sun, and B. Yu, High turnover with high price delay? Dissecting the puzzling phenomenon for China’s A-shares, Finance Res. Lett. 22 (2017), 105–113.

[43] S. Richardson, Earnings quality and short sellers, Account. Horizons 17 (2003), 49–61.

[44] M. Scott, Financial Accounting Theory, (3 rd ed.), New Jersey: Prentice Hall, 2000.

[45] M.H. Setayesh, F. Ebrahimi, S.M. Saif, and M. Sarikhani, Predicting the type of auditors’ comments with an approach based on data mining methods, Manag. Account. Res. J. (2011), no. 15, 69–82.

[46] M.H. Setayesh and M. Jamalianpour, Investigating the equation between financial ratios and non-financial variables with the auditor’s opinion, Account. Audit. Res. 1 (2009), no. 2, 130–157.

[47] N. Stanisic, T. Radojevic and N. Stanic, Predicting the type of auditor opinion: Statistics, machine learning, or a combination of the two?, Eur. J. Appl. Econ. 16 (2019), no. 2, 1–58.

[48] B. Van Tendeloo and A. Vanstraelen, Earnings management and audit quality in Europe: Evidence from the private client segment market, Eur. Account. Rev. 17 (2008), no. 3, 447–469.

[49] R.L. Watts and J.L. Zimmerman, Agency problems, auditing, and the theory of the firm: Some evidence, J. Law Econ. 26 (1983), no. 3, 613–633.

[50] D.G. Whiting, J.V. Hansen, J.B. McDonald, C. Albrecht, and W.S. Albrecht, Machine learning methods for detecting patterns of management fraud, Comput. Intell. 28 (2012), no. 4, 505–527.

[51] D. Zdolˇsek and T. Jagriˇc, Audit opinion identification using accounting ratios: experience of United Kingdom and Ireland, Aktual. Prob. Ekon. 115 (2011), no. 1, 285–310.

[52] C.A. Zhang, Predict audit quality using machine learning algorithms, Proc. Seventeenth Int. Florida Artific. Intelli. Res. Soc. Conf. FLAIRS, 2004, no. 2, pp. 1–6.