Research on World Agricultural Economy

The Promoting Effect of Rural Enterprise Governance Structure Adjustment on Audit Quality in the Context of Digital Transformation

Yiyuan Zhang

School of Business and Economics, Universiti Putra Malaysia, Serdang 43400, Selangor, Malaysia

Tze San Ong

School of Business and Economics, Universiti Putra Malaysia, Serdang 43400, Selangor, Malaysia

Asna Abdullah Atqa

School of Business and Economics, Universiti Putra Malaysia, Serdang 43400, Selangor, Malaysia

DOI: https://doi.org/10.36956/rwae.v6i1.1515

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Abstract

Based on empirical data from 1,826 rural enterprises during 2019-2023, this study systematically examines the promoting effect and working mechanism of corporate governance structure adjustment on audit quality in the context of digital transformation. The findings reveal that digital transformation significantly optimizes rural enterprise governance structures, with each standard deviation increase in digital transformation level leading to an average increase of 0.254 standard deviations in enterprise governance structure scores. However, significant regional differences exist, with the impact coefficient in eastern regions (0.312) notably higher than in central (0.245) and western regions (0.198). The optimization of governance structure has a significant promoting effect on audit quality, with research showing that each standard deviation increase in governance structure scores leads to a 0.308 standard deviation improvement in audit quality. Moreover, governance structure exerts a 54.52% mediating effect in the process of digital transformation influencing audit quality, with this promoting effect being more pronounced in large enterprises (impact coefficient 0.385). Additionally, regional economic development levels significantly moderate the relationship between digital transformation, governance structure, and audit quality. The level of digital infrastructure (interaction coefficient 0.145) and degree of agricultural industrialization (interaction coefficient 0.132) can significantly enhance the promoting effect of governance structure on audit quality, while policy support intensity shows a significant positive correlation with transformation effectiveness (coefficient 0.156). The research findings not only deepen the understanding of the relationship between rural enterprises' digital transformation and governance optimization but also provide empirical support for formulating differentiated regional development strategies.

Keywords: Digital Transformation; Rural Enterprise; Corporate Governance; Audit Quality; Regional Economic Development

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