The association between audit quality, accounting disclosures and firm-specific risk: Evidence from initial public offerings

2003 ◽  
Vol 22 (5) ◽  
pp. 377-400 ◽  
Author(s):  
Philip Lee ◽  
Donald Stokes ◽  
Stephen Taylor ◽  
Terry Walter
Keyword(s):  
Initial Public Offerings ◽  
Audit Quality ◽  
Public Offerings ◽  
Accounting Disclosures ◽  
Specific Risk

Litigation Risk, Audit Quality, and Audit Fees: Evidence from Initial Public Offerings

2008 ◽  
Vol 83 (5) ◽  
pp. 1315-1345 ◽  
Author(s):  
Ramgopal Venkataraman ◽  
Joseph P. Weber ◽  
Michael Willenborg
Keyword(s):  
Earnings Management ◽  
Initial Public Offerings ◽  
Audit Quality ◽  
Audit Fees ◽  
Legal Liability ◽  
Litigation Risk ◽  
Substantial Portion ◽  
Public Offerings ◽  
Offering Price ◽  
Robust Evidence

ABSTRACT: We use the IPO setting to examine the relation between auditor exposure to legal liability and audit quality and audit fees. With regard to audit quality, we report robust evidence that pre-IPO audited accruals are negative and less than post-IPO audited accruals. In contrast to extant literature, our findings provide scant support for the inference that auditors acquiesce to opportunistic earnings management by issuers in an attempt to increase the offering price. With regard to audit fees, we find auditors earn higher fees for IPO engagements than post-IPO engagements. While inherent differences in auditor responsibilities between IPO audits and post-IPO audits should lead to higher fees for IPOs, a substantial portion of IPO audit fees (in levels and changes) is associated with our proxy for the auditor’s 1933 Act exposure. Overall, our results suggest that both audit quality and audit fees are higher in a higher-litigation regime, consistent with the effects an increase in litigation exposure should have on auditor incentives.

scholarly journals Editorial note

2018 ◽  
Vol 15 (4) ◽  
pp. 4-5 ◽  
Author(s):  
Virginia Bodolica ◽  
Raymond Siu Yeung Chan
Keyword(s):  
Initial Public Offerings ◽  
Financial Reporting ◽  
Audit Quality ◽  
Editorial Note ◽  
Company Performance ◽  
Board Diversity ◽  
Public Offerings ◽  
Share Prices ◽  
Policy Cost ◽  
Public Sector Leadership

The recent volume of the journal “Corporate Ownership and Control” is devoted to the issues of dividend policy, cost management, public sector, leadership, earnings announcements, share prices, earnings relevance, concentrated ownership, financial reporting, risk disclosures, public listing, profitability, initial public offerings, market timing, company performance, board diversity, CEO characteristics, board independence, ownership network, national intelligence, earnings management, securities class actions, auditor litigation, audit quality, reverse mergers etc.

scholarly journals Venture capital and risk management: evidence from initial public offerings

2012 ◽  
Vol 2 (1) ◽  
pp. 30-40 ◽  
Author(s):  
Charles E. Bamford ◽  
Edward B. Douthett
Keyword(s):  
Risk Factors ◽  
Risk Management ◽  
Venture Capital ◽  
Initial Public Offerings ◽  
Venture Capitalists ◽  
Profit Margins ◽  
Public Offerings ◽  
Operating Profit ◽  
Specific Risk ◽  
Ex Ante

In this study we analyze a sample of initial public offerings (IPOs) to infer the sources of firm-specific risk associated with investment by venture capitalists. The results indicate that IPO backing by venture capitalists is associated with risk factors related to operating profit margins and ongoing sales generation, but not operational financing. The results also indicate that venture-backed IPOs are associated with greater reductions in firm-specific risk over the course of a year that includes the date of the IPO. In sum, the findings suggest venture capitalists are willing to accept higher levels of uncertainty in those instances where they have an advantage in terms of managerial skill, and are able to reduce firm-specific risk subsequent to investment in order to maximize returns when they cash out. Our study also makes use of proxies that are representative of the ex-ante nature of firm-specific risk at the time of a new issue.

scholarly journals Uji Model Kualitas Audit: Studi Empiris Perusahaan yang Melakukan IPO di Bursa Efek Indonesia

2020 ◽  
Vol 16 (2) ◽  
pp. 44-52
Author(s):  
T. Husain ◽  
Melani Quintania ◽  
Nedi Hendri
Keyword(s):  
Initial Public Offerings ◽  
Public Perception ◽  
Audit Quality ◽  
Financial Statement ◽  
Public Offerings ◽  
Public Company ◽  
Quality Modeling ◽  
Profitability Ratios ◽  
Weak Influence

Various financial statement scandals lead to a low public perception of audit quality. The quality of the audit itself can be studied from various perspectives. This research uses the paradigm of thinking to test audit quality modeling in predicting financial ratios consisting of liquidity ratios, activity ratios, solvency ratios, profitability ratios, and market prospect ratios. The type of research is causality with a quantitative approach. The subject of this research uses a public company that does Initial Public Offerings (IPO) in 2019. Data analysis methods use logistic regression analysis. This study's findings show that it meets the model's specifications, with nagelkerke r square score of 0.151, which means it has a weak influence in explaining the model. Besides that, does not yield influence simultaneously with omnibus tests of model coefficients and only one proof of the hypothesis of the Financial Ratio's viz price-to-book value proxy test that has a partially significant effect with the wald testing.

scholarly journals ANALISIS PENGARUH KUALITAS AUDIT DAN UKURAN PERUSAHAAN TERHADAP MANAJEMEN LABA

2016 ◽  
Vol 2 (1) ◽  
pp. 65 ◽  
Author(s):  
Yosi Dwi Heryan ◽  
Zaenal Alim Adiwijaya
Keyword(s):  
Initial Public Offerings ◽  
Sampling Method ◽  
Audit Quality ◽  
Analysis Data ◽  
Theory Model ◽  
Earning Management ◽  
Public Offerings ◽  
Discretionary Accrual ◽  
Big Four ◽  
Industry Specialist

The purpose of this research is to investigate and get empirical about auditor big four, auditor industry specialist, and size in the earning management limit by the firms audited for IPO firms. Earning management on this research is use discretionary accrual. Audit quality on this research is used by auditor big four and auditor industry specialist. Size on this research is measured by total assets. The object of this research is non finance firms which do IPO (Initial Public Offerings) in Indonesia. It used 47 Indonesia IPO firms from 2008-2011. The method of data collection is purposive sampling method. Multiple regression is used to analysis data and develops the theory model. The result of this research indicates that auditor big four proved cannot limit the earning management for firms which is audited by auditor big four when firms do IPO. Auditor industry specialist can limit the earning management when firms do IPO in Indonesia. Size cannot limit the earning management when the firms do IPO in Indonesia

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