Research On The Impact Of Audit Quality On Stock Price Information Content

One of the basic functions of the securities market is to assemble and deliver information through stock price changes.Under the background of China's emerging markets and economic transition,stock prices play an important role in optimizing resource allocation.Compared with the developed capital market,China's stock price information content is still at a low level.Tracing back to the source of the problem affecting the stock price information content,the disclosure of specific information at the company level is one of the key factors.Due to various types of financial fraud and information disclosure violations in China's A-share market,the reliability of listed companies' financial reports is difficult to be convinced,exposing many problems in the information disclosure of listed companies,and seriously affects the situation of real information flowing into the market at company-level.As the supervisor and transmitter of information disclosure at the company level,the role and function of auditor are a key areas worthy of attention.Can audit quality really improve the information environment of the capital market? What are the mechanisms that affect the content of stock price information? What are the effects of audit quality on stock price information content? This thesis will focus on the above issues.This thesis combines the normative research and empirical research methods.Firstly,it combs and summarizes the domestic and foreign literatures on stock price information content and audit quality.Secondly,based on the effective market theory,principal-agent theory,information asymmetry theory and audit demand theory,the mechanism of the impact of audit quality on stock price information is discussed.At the same time,this thesis combines different realistic situations,analyzes the difference in the effect of audit quality on stock price information content,re-examines the role and position of auditors in the market,and proposes research hypotheses.Finally,this thesis takes the financial data of A-share listed companies in Shanghai and Shenzhen from 2010-2017 as samples,and uses the multiple regression method to conduct empirical tests.Considering the indirectness of audit quality measurement in existing research,this thesis systematically examines the effect of audit quality on stock price information from the perspective of input and output of audit work.The research results show that high-quality auditing can significantly improve the stock price information content,and the input indicators have better effects than the output quality indicators of audit quality.In the discussion of different situations,it is found that in companies with greater investor heterogeneity beliefs,high-quality auditing plays a greater role in promoting the information content of stock prices;Auditors and analysts have complementary relationship in improving the information content of stock prices;Compared with state-owned enterprises,high-quality auditing plays a greater role in promoting the information content of stock prices in non-state-owned enterprises.The contributions of this thesis are as follows: Firstly,from the perspective of external influence mechanism,through the measurement of audit quality from different perspectives,it systematically explore the effect of audit quality on stock price information content;Secondly,based on the characteristics of investors' heterogeneous beliefs,auditors' role-playing and the nature of corporate property rights have expanded the impact of audit quality on capital markets from the micro and macro levels.This thesis theoretically supplements the research of existing scholars to expand the market share price performance to the audit field,and also provides theoretical evidence for investors on how to better identify and use the specific information at the listed company level and how to improve the audit quality.This thesis also strengthens the information disclosure supervision of listed companies and improves the information disclosure policy of listed companies provide evidence support.