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Auditor Resignation And Stock Price Crash Risk
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Mehdi Amini1   , Peyman Amini *  1 |
| 1- Department of Accounting, Faculty of Humanities and Social Sciences, University of Kurdistan, Sanandaj, Iran. |
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Abstract: (2718 Views) |
Investing in the stock market comes with its own specific risks that need to be considered. One of the most significant risks in stock market investing is the stock price crash risk. There are several factors that can influence the occurrence of this risk, which have been addressed in the present study by examining the relationship between auditor resignation and the stock price crash risk. Independent auditors have access to more extensive information about the companies they examine. This very fact has led to any changes in independent auditors being deemed important and receiving attention. Therefore, it is expected that company shareholders, especially small shareholders who have limited information about the internal conditions of the company, would react to changes in independent auditors. Furthermore, it is predicted that the size of auditing firms would have a moderating effect on the shareholders’ reaction to auditor resignation. In this regard, a sample of 129 companies listed on the Tehran Stock Exchange over a period of 10 years from 2012 to 2021 was selected and tested using the Eviews software and employing the combined data method. The results obtained from the hypotheses testing of the research indicated a significant relationship between auditor resignation and the stock price crash risk. Moreover, the size of auditing firms has a moderating effect on the relationship between auditor resignation and the stock price crash risk.
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Article number: 6 |
| Keywords: Stock Price Crash Risk, Auditor Resignation, Stock Crash Period, Size of Auditing Firms |
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Full-Text [PDF 588 kb]
(85 Downloads)
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Type of Study: Research |
Subject:
Special
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