search query: @author Gaeremynck, A. / total: 4
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| Author: | Gaeremynck, A. Willekens, M. |
| Title: | The Endogenous Relationship between Audit-Report Type and Business Termination: Evidence on Private Firms in a Non-Litigious Environment |
| Journal: | Accounting and Business Research
2003 : VOL. 33:1, p. 65-80 |
| Index terms: | COMPANIES AUDITORS AUDITING BANKRUPTCY |
| Language: | eng |
| Abstract: | This study provides evidence on the relationship between audit-report type and subsequent business termination for private companies in a non-litigious environment. The results show that an endogenous relationship exists between bankruptcy and audit-report type, and between voluntary liquidation and audit-report type. A non-clean opinion is typically issued when firms face financial difficulties, which in turn become more severe after the receipt of a non-clean audit opinion. The authors find evidence that, even without a litigation deterrent in Belgium, financial performance has a similar impact on audit-report type as in litigious environments. The authors find that the self-fulfilling prophecy hypothesis holds for bankruptcy but not for voluntary liquidation. |
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