AUDITOR SELECTION, CORPORATE MANAGEMENT AND CUSTOMER FIRM CHARACTERISTICS: A STUDY ON BORSA ISTANBUL

The purpose of the study was to examine the impact of firm corporate management applications and firm characteristics on independent auditor selection. For this purpose, a total of 583 firm-year observations encompassing the years 2015-2018 were used for firms from different sectors in Borsa Istanbul. Auditing firm size was used as an indication for the auditor selection in the study. The number of independent members in the executive board, ownership concentration (share of the largest shareholder, share of the largest two shareholders, share of the largest three shareholders and free float ratio) and the number of auditing committee members are used as corporate management indicators; whereas firm size, leverage and return on assets (ROA) have been used as indicators of firm characteristics. It is observed based on the results of the analysis carried out using the logistics regression model that there is a positive and statistically significant relationship between auditor selection and the ownership ratio of the independent member and the largest shareholder used as corporate management indicator. Moreover, a positive and statistically significant relationship was determined between the firm size and ROA from among firm characteristics indicators and auditor selection