Adoption and content of key audit matters and stock price crash risk |
| |
| Affiliation: | 1. Nanjing Audit University, 86 Yushan West Road, Pukou, Nanjing, Jiangsu 211815, China;2. Kennesaw State University, Kennesaw Campus, 1000 Chastain Road, Kennesaw GA 30144, United States;3. UNSW Sydney, Quadrangle Building 3099, UNSW Sydney 2052 NSW Australia;4. Nanjing University of Finance and Economics, 3 Wenyuan Road, Xianlin College Town, Nanjing, Jiangsu 210023, China;1. College of Finance, Nanjing Agricultural University, Nanjing 210095, China;2. School of Advanced Agricultural Sciences, Peking University, Beijing 100871, China;3. Business School, Hohai University, Nanjing 211100, China;1. School of Mathematics and Finance, Anhui Polytechnic University, Wuhu, China;2. Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai, China;3. Data-Driven Management Decision Making Lab, Shanghai Jiao Tong University, Shanghai, China;1. Department of Digital Economy, Shanghai University of Finance and Economics, No 777 Guoding Road, Shanghai 200433, China;2. School of Information Management & Engineering, Shanghai University of Finance and Economics, No 777 Guoding Road, Shanghai 200433, China;3. Faculty of Business information, Shanghai Business School, No 123 Fengpu Avenue, Shanghai 201400, China;1. Center for Quantitative Economics of Jilin University, Changchun 130012, PR China;2. Business and Management School of Jilin University, Changchun 130012, PR China;3. Economics School of Changchun University, Changchun 130021, PR China |
| |
| Abstract: | We examine whether the mandate for auditors to report key audit matters (KAMs) affects firm-specific stock price crash risk in China. Auditors in China are required to issue an expanded audit report that contains KAMs for AH-share firms, effective on January 1, 2017 (applicable to the financial year 2016), and for A-share firms, effective on January 1, 2018 (applicable to the financial year 2017). Applying a staggered difference-in-differences (D-i-D) design on a sample of 18,751 observations for financial years 2012–2019, we find that auditor reporting of KAMs is not significantly associated with stock price crash risk. The mechanism tests show that the disclosure of KAMs does not reduce information opaqueness and managerial opportunistic behaviors. Furthermore, our findings are not sensitive, but are robust to firms' corporate governance, product market competition, ownership structure, and auditor size. Overall, our study informs regulators, investors, auditors, and other stakeholders interested in the economic consequences of mandating KAM disclosures. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
