Informativeness of the expanded audit report: Evidence from China
This study investigates whether the expanded audit report is informative to investors in the setting of an emerging economy. Using the recent staggered adoption of the expanded audit report for A+H and A share firms in China, we find robust evidence that abnormal trading volume and earnings response...
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sg-smu-ink.soa_research-28802021-01-22T06:26:13Z Informativeness of the expanded audit report: Evidence from China GOH, Beng Wee LEE, Jimmy LI, Dan WANG, Muzhi This study investigates whether the expanded audit report is informative to investors in the setting of an emerging economy. Using the recent staggered adoption of the expanded audit report for A+H and A share firms in China, we find robust evidence that abnormal trading volume and earnings response coefficients are higher, and stock price synchronicity are lower, in the post-adoption periods than in the pre-adoption periods. In additional tests, we find that the expanded audit report is more informative for non-State Owned Enterprises and for firms with higher information asymmetry. Overall, our study documents systematic evidence that the expanded audit report is incrementally informative to investors in an emerging economy. 2019-08-01T07:00:00Z text application/pdf https://ink.library.smu.edu.sg/soa_research/1853 https://ink.library.smu.edu.sg/context/soa_research/article/2880/viewcontent/Manuscript_submited_to_AJPT.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection School Of Accountancy eng Institutional Knowledge at Singapore Management University expanded audit report market reaction informativeness earnings response coefficient price synchronicity Accounting Asian Studies |
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expanded audit report market reaction informativeness earnings response coefficient price synchronicity Accounting Asian Studies GOH, Beng Wee LEE, Jimmy LI, Dan WANG, Muzhi Informativeness of the expanded audit report: Evidence from China |
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This study investigates whether the expanded audit report is informative to investors in the setting of an emerging economy. Using the recent staggered adoption of the expanded audit report for A+H and A share firms in China, we find robust evidence that abnormal trading volume and earnings response coefficients are higher, and stock price synchronicity are lower, in the post-adoption periods than in the pre-adoption periods. In additional tests, we find that the expanded audit report is more informative for non-State Owned Enterprises and for firms with higher information asymmetry. Overall, our study documents systematic evidence that the expanded audit report is incrementally informative to investors in an emerging economy. |
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text |
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GOH, Beng Wee LEE, Jimmy LI, Dan WANG, Muzhi |
author_facet |
GOH, Beng Wee LEE, Jimmy LI, Dan WANG, Muzhi |
author_sort |
GOH, Beng Wee |
title |
Informativeness of the expanded audit report: Evidence from China |
title_short |
Informativeness of the expanded audit report: Evidence from China |
title_full |
Informativeness of the expanded audit report: Evidence from China |
title_fullStr |
Informativeness of the expanded audit report: Evidence from China |
title_full_unstemmed |
Informativeness of the expanded audit report: Evidence from China |
title_sort |
informativeness of the expanded audit report: evidence from china |
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Institutional Knowledge at Singapore Management University |
publishDate |
2019 |
url |
https://ink.library.smu.edu.sg/soa_research/1853 https://ink.library.smu.edu.sg/context/soa_research/article/2880/viewcontent/Manuscript_submited_to_AJPT.pdf |
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