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CFOs With Audit Firm Working Experience and Corporate Risk‐Taking

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  • Yue Luo
  • Zilong Song
  • Yumiao Yu
  • Xiaohui Zhao

Abstract

Using data from Chinese A‐share listed companies, we examine how CFO audit firm experience influences corporate risk‐taking. Our findings show that companies with CFOs who have audit firm experience exhibit significantly lower risk‐taking levels. However, this effect weakens if the CFO has a lower shareholding ratio, prior experience in non‐Big Four audit firms, or shorter audit firm tenure. Mechanism tests reveal that CFOs with audit firm experience reduce risk‐taking by curbing capital expenditures, external financing, and R&D spending. This study highlights the critical role of CFOs' professional backgrounds in shaping corporate governance and risk management strategies.

Suggested Citation

  • Yue Luo & Zilong Song & Yumiao Yu & Xiaohui Zhao, 2025. "CFOs With Audit Firm Working Experience and Corporate Risk‐Taking," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 65(4), pages 3247-3269, December.
    • Handle: RePEc:bla:acctfi:v:65:y:2025:i:4:p:3247-3269
    DOI: 10.1111/acfi.70038
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