Topic: Green Transition and Information Verification Cost
Speaker: Qinlin Zhong
Date & Time: 13:30-15:00 Friday, April 7, 2023
Venue: Tencent Meeting (Meeting ID: 803 239 593)
Organizers: School of Accounting, Dongbei University of Finance and Economics, P.R. China & Liaoning Capital Market Finance and Accounting Graduate Innovation and Academic Exchange Center
Abstract:
This paper examines whether and how the green transition affects the information verification cost of firms in the high polluting industries. Utilizing the implementation of the Green Audit of Outgoing Officials (GAOO) policy in China, we find that audit fees of firms in the high polluting industries significantly decrease when the economy transits toward green. We provide supporting evidence for two channels: (1) Auditors rely on heightened governmental monitoring and reduce audit efforts, for a certain level of evidence; (2) Firms in high polluting industries improve environmental performance which leads to lower client risks, thus allowing for less audit evidence. Additional analysis shows that reduced audit fee was not accompanied by the deterioration in audit quality. Overall, our paper indicates that the green transition can reduce the information verification cost and facilitate information process, suggesting that the economic development model has a fundamental influence on the financial market. Our results are consistent with the growth-led finance hypothesis and contributes to the growth-finance nexus theory.
Introduction of Speaker:
Qinlin Zhong, Associate Professor at the School of Management at Fudan University, P.R. China, PhD of Peking University, P.R. China. The main research directions are information disclosure and corporate governance. The research achievements have been published in important domestic and international academic journals such as Journal of Accounting and Economics, Contemporary Accounting Research, Accounting and Finance, China Journal of Accounting Research, Journal of Management Sciences in China, Journal of Management World, Accounting Research, Journal of Financial Research, etc.
Special Attention:
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