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May 11, 2026Journal of Accounting Literature

The value of ex ante auditor disclosure: evidence from China

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Authors

WLWenjun LiuRZRan ZhangJCJune Cao

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Overview

Randomized trial examines investor responses to auditor information disclosure, showing its impact on decision-making.

Key Points

  • This study aims to determine how ex ante disclosure of auditor information affects investor decisions in China.
  • Utilized an event study approach to analyze investor reactions to announcements pre- and post-reform involving auditor identity.
  • Compared responses to announcements containing auditor information to those without it to isolate causal effects.
  • Examined the role of information acquisition costs, analyst coverage, and media attention on investor reactions.
  • Ex ante disclosure of auditor identity leads to positive market reactions, especially for high-quality auditors.
  • Market responses weaken with lower information acquisition costs and disappear under high-cost inference conditions.
  • Analyst coverage and media attention enhance reactions by making auditor information more accessible to investors.

Cite This Study

Liu et al. (2026) studied this question.

synapsesocial.com/papers/6a0171ce3a9f334c28271e33https://doi.org/10.1108/jal-10-2025-0581
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