Prior research documents that financial capacity could be positively or negatively associated with the demand for audit quality. We re-examine this relation using changes in local real estate prices as exogenous shocks to corporate financial capacity. Using auditor size, auditor industry specialisation, and auditor fees as measures of audit quality, we find robust evidence that an increase (decrease) in financial capacity significantly reduces (increases) the demand for audit quality, and that this relation is more pronounced when firms are more financially constrained, when external monitoring by institutional investors and financial analysts is weaker, and when there is more negative news about real estate price changes. Our study enriches the related literature by describing a more complete and dynamic relationship between audit quality and financial capacity.

先前的研究表明，财务能力可能与对审计质量的需求正相关或负相关。我们使用当地房地产价格的变化作为对企业财务能力的外生冲击来重新审视这种关系。使用审计师规模、审计师行业专业化和审计师费用作为审计质量的衡量标准，我们发现强有力的证据表明，财务能力的增加（减少）显着降低（增加）对审计质量的需求，并且当公司当机构投资者和金融分析师的外部监控较弱，以及房地产价格变化的负面消息较多时，财务约束会更大。