Abstract
The large-scale stock price fluctuations that occur from time to time in the global stock market highlight the important research significance of stock price crash risk. Existing researches have paid little attention to the impact of abnormal audit fees on stock price crash risk. This article explores its relationship with stock prices from this perspective. The relationship between the crash risk and whether the abnormal audit fee can be used as an early warning signal for the company’s stock price crash risk has enriched the related research on the influencing factors of the stock price crash risk and the early warning mechanism.
Highlights
Economic globalization has enabled the securities market to develop rapidly, but with it comes the stock price crash caused by the significant increase in the frequency of stock price fluctuations, the orderly operation of investors’ personal wealth, the efficiency of social resource allocation, and even the entire capital market, which have a huge impact
If the audit fee deviates from the normal value to a greater extent, it may represent a greater risk premium faced by the enterprise, which reflects the stock price collapse risk from the side
This article uses the data of Shanghai and Shenzhen Ashare superior companies from 2002 to 2017 as a research sample, and mainly studies the relationship between the auditor’s audit fees, abnormal audit fees and the company’s stock price crash risk
Summary
Economic globalization has enabled the securities market to develop rapidly, but with it comes the stock price crash caused by the significant increase in the frequency of stock price fluctuations, the orderly operation of investors’ personal wealth, the efficiency of social resource allocation, and even the entire capital market, which have a huge impact. If the audit fee deviates from the normal value to a greater extent, it may represent a greater risk premium faced by the enterprise, which reflects the stock price collapse risk from the side. This article attempts to test whether it can be used as an early warning signal of the company’s stock price collapse risk from the perspective of abnormal audit fees
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