Annual Congress of the European Accounting Association 2024

  • Lee, M. Y. (Speaker)
  • Ferdinand Akthar Khan Gul (Speaker)
  • Karen MY Lai (Speaker)
  • Bin Srinidhi (Speaker)

Activity: Participating in or organising an event types › Contribution to conference

Description

Unlocking the power of audit-related services in managerial investment decisions

The research demonstrates the informative role of audit-related services (ARS) in managers' investment choices. The study reveals that ARS diminishes the investment-Q sensitivity, suggesting that managers rely less on stock prices as they gain insights into the company's prospects through ARS. This aligns with the idea that auditors facilitate valuable information transfer through knowledge spillover and reduced information extraction expenses. Additionally, this study uncovers a stronger relationship between ARS and decreased investment-Q sensitivity in cases where firms have lower internal information quality. This is evident from factors such as slower filing speed, higher incidence of internal control weaknesses (ICW), and lower accruals quality. This outcome underscores that managers in firms with inferior information quality not only seek more ARS engagement but also decrease their reliance on stock prices.
Period15 May 2024
Event typeConference
Conference number46th
LocationBucharest, RomaniaShow on map
Degree of RecognitionInternational