PCAOB Monitoring and the Information Uncertainty Associated with Fair Value Estimates

摘要: This study examines the role of PCAOB inspection reports as a regulatory and monitoring mechanism. Specifically, I examine whether issuance with fair value deficiencies results in increased auditor scrutiny estimates ultimately reduce information uncertainty associated level 2 3 estimates. Using models derived from Fields, Fraser Wilkins (2004) Riedl Serafeim (2011), predict find evidence that corroborates positive significant audit effort (as proxied by fees) after report. also reduction implied asset-specific betas). Upon further subsample analysis, these are driven issuer clients engage annually inspected firms versus those triennially firms.