Mandatory Disclosure of Industry Operational Information and Audit Fees
Using a succession of industry disclosure rules issued by the SHSE and SZSE as a natural experiment,we investigate how firms'mandatory disclosure of industry operational information affects their audit fees.We find that firms required to disclose industry operational information have much lower audit fees following disclosure in comparison to their counterparts.Furthermore,heterogeneity analysis indicates that the above effect is less pro-nounced when the auditor's perception of risk is higher.It is more pronounced when comparability in the industry is higher,and when the firms'informa-tion is less transparent.Moreover,the audit efficiency and audit quality of firms with mandatory disclosure of industry operational information are also sig-nificantly higher after the disclosure.In conclusion,the results suggest that mandatory disclosure of industry operational information reduces audit fees by alleviating information asymmetry between auditors and firms and improves audit quality.
NETL
NSTL
万方数据
