Investor protection, firm informational problems, big n auditors, and cost of debt around the world
Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 21_Publication in refereed journal › peer-review
Author(s)
Related Research Unit(s)
Detail(s)
| Original language | English |
|---|---|
| Pages (from-to) | 1-30 |
| Journal / Publication | Auditing |
| Volume | 32 |
| Issue number | 3 |
| Publication status | Published - Aug 2013 |
Link(s)
Abstract
This paper examines the effects of investor protection, firm informational problems (proxied by firm size, firm age, and the number of analysts following), and Big N auditors on firms' cost of debt around the world. Using data from 1994 to 2006 and over 90,000 firm-year observations, we find that the cost of debt is lower when firms are audited by Big N auditors, especially in countries with strong investor protection. Second, we find that firms with more informational problems (i.e., higher information asymmetry problems) benefit more from Big N auditors in terms of lower cost of debt only in countries with stronger investor protection.
Research Area(s)
- Audit quality, Cost of debt, Information asymmetry, Informational problems, Investor protection
Citation Format(s)
Investor protection, firm informational problems, big n auditors, and cost of debt around the world. / Gul, Ferdinand A.; Zhou, Gaoguang Stephen; Zhu, Xindong Kevin.
In: Auditing, Vol. 32, No. 3, 08.2013, p. 1-30.Research output: Journal Publications and Reviews (RGC: 21, 22, 62) › 21_Publication in refereed journal › peer-review
