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Research On The Information Content And Differences Of Unqualified Audit Opinions In The Section With Emphasized Matters

Posted on:2013-12-08Degree:MasterType:Thesis
Country:ChinaCandidate:J ChenFull Text:PDF
GTID:2439330371970547Subject:Accounting
Abstract/Summary:PDF Full Text Request
As is known to all, capital market is an important place for optimizing resourceallocation, the high-quality information is basic of the capital market stability and healthydevelopment, as the guarantor of the relevant information, certified public accountantsuse audit report to achieve reasonable assurance that the relevant information, thusindirectly improving quality of information that disclosed by listed companies. Auditopinion is the most important elements in the audit report, which also makes the auditopinion to possess the characteristics of market information in the capital market in China.The information content of the type of audit opinion is not a new topic. It is the inevitablein our development of capital markets. Similarly, to further standardize the informationdisclosure mode is also registered to the inevitable development of the accountingprofession.Based on previous research, we studied the listed companies in Shanghai andShenzhen markets which had been issued such audit opinions from2007to2010from theunique perspective of Unqualified Audit Opinion with Emphasis of Matter Paragraphs(UAOEMP). Event-research method is employed to study the information content anddifferences of UAOEMP by constructing multiple regression models wherein CAR is thedependent variable. In this thesis, the research background and theoretical basis arestudied first. Then our methodology is introduced and our hypothesis is proposed. Basedon previous research, events and time-windows are also defined considering the specificsituation of China's capital markets. Secondly, detailed research procedures are designed,wherein the average excess return and the cumulative average excess rate of return of thesamples are used as indicators. Market models are used to estimate the normal expectedreturn. To avoid the "industry effect" among the samples, the index is calculated usingindustry rate of return. The study aims at confirming the information content ofUAOEMP, as well as their differences considering factors including continuingoperations, influential uncertainties etc. Disclosure of audit reports is defined as an eventand a period after the disclosure is defined as time window. Analysis of the event'simpact on a particular dependent variable within the time window is the core ofinformation content research. In other words, the key to the research of informationcontent of audit opinions is whether it is useful for decision-making to policy makers.This key also contributes to making the abnormal returns of the stock price a favorableCAR.The main contribution of this dissertation about: improve the research point ofview on such issues through the unique perspective of an unqualified audit opinion withemphasis of matter paragraph; with emphasis on matters section of an unqualified auditopinion issued by the stressed matter section of the different classification to separate theinformation content difference, which for the first time to verify the differences of thethree information content; amendments to the existing regression model taking intoaccount the data, analysis of existing research results accessibility of the information content of financial statements can be stripped of degrees and control variablescorrelation and other factors modified the basic model.This dissertation aims to reveal with emphasis on matters in paragraph no informationgain unqualified audit opinion to the stock market and its various types of differences ofemphasis of matter paragraph information content. Warning investors concerned aboutthe differences in information content, prudent investment decisions.And the same time,the dissertation trying to provide appropriate evidence for the guidelines, institutionalarrangements and market regulators.
Keywords/Search Tags:Emphasized matters paragraph, audit opinion, information content, market reaction
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