Impact of rural corporate governance structure improvement on audit quality in the context of digital transformation of China

This study investigates how digital transformation impacts audit quality through governance structure improvements in rural enterprises. Based on data from 1,826 rural enterprises (2019-2023), we find that digital transformation significantly optimizes governance structures, with each standard deviation increase in digital transformation leading to a 0.254 standard deviation improvement in governance scores. Regional differences are evident, with eastern regions showing higher impact (coefficient 0.312) than central (0.245) and western regions (0.198). Governance optimization enhances audit quality, as each standard deviation increase in governance scores yields a 0.308 standard deviation improvement in audit quality. Governance structure mediates 54.52% of digital transformation’s effect on audit quality, with stronger effects in large enterprises (coefficient 0.385). Regional economic development moderates these relationships, with digital infrastructure (interaction coefficient 0.145) and agricultural industrialization (0.132) enhancing governance structure’s effect on audit quality. Policy support intensity correlates positively with transformation effectiveness (0.156). These findings provide empirical support for differentiated regional development strategies.

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