Investor Protection, Firm Informational Problems, Big N Auditors, and Cost of Debt around the World
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 th...
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| Veröffentlicht in: | Auditing : a journal of practice and theory 2013-08, Vol.32 (3), p.1-30 |
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| container_title | Auditing : a journal of practice and theory |
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| creator | Gul, Ferdinand A. Zhou, Gaoguang (Stephen Zhu, Xindong (Kevin |
| description | 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. |
| doi_str_mv | 10.2308/ajpt-50462 |
| format | Article |
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| identifier | ISSN: 0278-0380 |
| ispartof | Auditing : a journal of practice and theory, 2013-08, Vol.32 (3), p.1-30 |
| issn | 0278-0380 1558-7991 |
| language | eng |
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| source | EBSCOhost Business Source Complete |
| subjects | Auditors Cost of capital Information science International finance Investors Studies |
| title | Investor Protection, Firm Informational Problems, Big N Auditors, and Cost of Debt around the World |
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