Investor Protection, Firm Informational Problems, Big N Auditors, and Cost of Debt around the World

Ferdinand A. Gul · Gaoguang Zhou · Xindong Kevin Zhu

119 citations0/0 files storedAuditing A Journal of Practice & Theory

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Auditing, Earnings Management, Governance Corporate Finance and Governance Credit Risk and Financial Regulations

Abstract

SUMMARY: 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. JEL Classifications: G14; G15; G32; K22; M42.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 119 citations exist upstream.

References

1976Theory of the firm: Managerial behavior, agency costs and ownership structure 1998Law and Finance 1997Legal Determinants of External Finance 2001Information asymmetry, corporate disclosure, and the capital markets: A review of the empirical disclosure literature 1981Auditor size and audit quality 1985Positive Accounting Theory 2003Earnings management and investor protection: an international comparison 1998The Effect of Audit Quality on Earnings Management*

Cited by

2020Does it pay off? Integrated reporting and cost of debt: European evidence 2020CSR performance and the cost of debt: does audit quality matter?2016International Archival Auditing and Assurance Research: Trends, Methodological Issues, and Opportunities 2015Audit Quality and Corporate Governance: Evidence from the Microfinance Industry 2017Multinational Group Audits: Problems Faced in Practice and Opportunities for Research 2016

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.