Research On The Impact Of Audit Quality On The Shell Value Of ST Companies

The direct listing cost in China is relatively high and the review is relatively strict,and it is difficult for non-listed companies to enter the securities market.As a unique listing platform,the shell of a listed company can allow enterprises to obtain the right to trade and finance in the capital market.It has obviously become a resource that investors especially favor and compete with each other.Because of the poor operating performance and low stock prices of ST companies,many of them are shell resources available to non-listed companies.However,the backdoor transaction is a major asset reorganization,the transaction amount is huge and the impact is extensive.In the process of the backdoor transaction,there is a serious information asymmetry between the two sides of the backdoor.In order to obtain higher shell sales income,ST companies may make false information disclosure by means of artificially increasing assets and concealing liabilities,which will cause the transaction value of ST shell resources to deviate from the actual value and damage the efficiency of market resource allocation.As a third-party mechanism,auditing can audit and verify the financial information of ST shell from an independent and objective standpoint to avoid false information disclosure by ST companies that retain assets.However,most of the existing researches use the method of case study to analyze the influencing factors of shell resources and the measurement methods of shell value,without considering the important role played by external supervisory agencies.Therefore,this article takes ST listed companies as the research object,on the basis of comprehensively combing the influencing factors of shell value,analyzes the mechanism of audit quality,and obtains the impact of audit quality on ST company shell value by empirical research.As a result,it was found that high-quality audits can alleviate information asymmetry in backdoor transactions through signal transmission mechanisms and effectively suppress the false increase in shell value.At the same time,the institutional environment and market timing are the main factors affecting the value of the shell,and its impact on the effect of audit quality is also the focus of this research.The study found that a strict institutional environment will strengthen the suppression of high-quality audit on the false increase in shell value.When the market is in a period of high valuation,the inhibitory effect of high-quality audit will be weakened.At the same time,compared with state-owned enterprises,the effect of audit quality on shell value is more significant in non-state-owned enterprises.Further examination revealed that the occurrence of mergers and acquisitions will weaken the impact of high-quality audit on the shell value.Auditing,as an external mechanism,has played a role in replacing corporate governance to a certain extent,in the sample of low corporate governance,the effect of high-quality audit on shell value is more significant.The research in this article enriches the research on the economic consequences of audit quality The capital market should pay attention to the signals transmitted by the third-party audit mechanism to help both parties to backdoor transactions comprehensively analyze and judge the value of shell resources and improve the efficiency of asset restructuring according to various factors such as institutional environment and market timing.At the same time,this paper suggests that ST company should take the initiative to change to a high-quality company.Only by improving the quality of the company can it keep its listing qualification.There are 6 figures,17 tables,68 references in this paper.