Do Political Connections Add Value to Audit Firms? Evidence from IPO Audits in China PDF Download
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Author: Zhifeng Yang
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
Audit firms become politically connected when their partners are appointed to the regulatory committee that screens prospective initial public offering (IPO) companies. Connections with regulators may enable audit firms to gain insights into the regulatory process which can help their clients prepare IPO applications, and lobby for favorable regulatory decisions. These arguments suggest that connections with regulators may help audit firms reduce IPO rejection risk for their clients, thus allowing them to charge higher IPO audit fees and gain more IPO clients. Regulatory committee appointments may benefit non-top tier audit firms more than they do top tier audit firms because reputational concerns are likely to encourage the latter to refrain from helping their clients raise the likelihood of passing the IPO screening process to a level higher than that justified by their clients' fundamentals. Consistent with these arguments and predictions, the findings of this study show that after their partners are appointed to the IPO screening committee, non-top audit firms significantly increase their IPO audit fees and IPO market share, and reduce IPO rejection risk for their clients, whereas top tier audit firms do not.
Author: Zhifeng Yang
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
Audit firms become politically connected when their partners are appointed to the regulatory committee that screens prospective initial public offering (IPO) companies. Connections with regulators may enable audit firms to gain insights into the regulatory process which can help their clients prepare IPO applications, and lobby for favorable regulatory decisions. These arguments suggest that connections with regulators may help audit firms reduce IPO rejection risk for their clients, thus allowing them to charge higher IPO audit fees and gain more IPO clients. Regulatory committee appointments may benefit non-top tier audit firms more than they do top tier audit firms because reputational concerns are likely to encourage the latter to refrain from helping their clients raise the likelihood of passing the IPO screening process to a level higher than that justified by their clients' fundamentals. Consistent with these arguments and predictions, the findings of this study show that after their partners are appointed to the IPO screening committee, non-top audit firms significantly increase their IPO audit fees and IPO market share, and reduce IPO rejection risk for their clients, whereas top tier audit firms do not.
Author: Qigui Liu
Publisher:
ISBN:
Category :
Languages : en
Pages : 27
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Book Description
This study examines the value of political capital in the Chinese IPO market. We find a positive relationship between a politically connected executive and the probability of IPO approval of entrepreneurial firms. We further identify that shareholders value those connections and give a market premium to connected firms after the firms go public. We provide evidence that other types of political capital gained through external sources, such as politically connected sponsors and PE investors, also bring benefits to the firms in their IPO approval, and these connections substitute for the effect of the executive's political connections on IPO approval. We argue that in emerging markets where government intervention is still prevalent, political capital does create value and entrepreneurial firms usually build political capital to facilitate their access to the IPO market, although other types of political capital do not bring further benefits into the post-IPO market.
Author: Douglas Cumming
Publisher: Springer
ISBN: 1137454636
Category : Business & Economics
Languages : en
Pages : 345
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Book Description
The focus of the global economy has increasingly shifted toward China and emerging countries. However, despite their high growth prospects, emerging economies often lack the sound capital market and corporate governance systems necessary to promote the efficient allocation of financial resources to maintain the confidence of capital providers. As China becomes more prominent economically, the development of its capital market becomes an increasingly important issue. This book presents some of the latest academic research on China's capital markets, demonstrating some of the major issues currently being faced. Preeminent researchers in the field examine key topics such as the performance of commercial banks, dividends and ownership, financial constraints and firm performance, the role of political networks, stock price decomposition, stock return predictability, and the role of media coverage. In this book, the authors use the country's institutional background to offer useful insight into policy implications for the development of China as well as other emerging economies.
Author: Qigui Liu
Publisher:
ISBN:
Category :
Languages : en
Pages : 41
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Book Description
This paper examines the value of political connections in the Chinese IPO market. We find a positive relationship between CEO/chairman's political connections and the probability of IPO approval of entrepreneurial firms. We further identify that minority shareholders value those connections and give a market premium to the connected firms after the firms go public. We provide evidence that connected independent directors and PE/VC investors bring important networks which facilitate firms' access to the IPO market, albeit the former complements and the latter substitutes the CEO/chairman's connections. We argue that in emerging markets where government intervention is still prevalent, the value of political connections does exist and entrepreneurial firms usually build political connections through different ways in order to facilitate their access the IPO market and obtain a higher market premium.
Author: Jerome Yen
Publisher: Springer Nature
ISBN: 9464631988
Category : Computers
Languages : en
Pages : 1595
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Book Description
This is an open access book.With the rapid development of modern economy and Internet technology, the traditional financial industry has to develop Internet finance to provide better services and meet the needs of the times. It is against this background that the blockchain, relying on its special advantages (collective maintenance, reliable databases, and decentralization), provides the reliability to solve the credit risk of Internet finance, has an impact on institutions, trust mechanisms, risk control, etc. in the Internet finance industry, and has derived more new application scenarios, thus paving the way for the development of finance in the Internet era. Applying blockchain technology to the financial field can promote data information sharing, improve value transmission efficiency, and enhance database security. The financial market based on the decentralized system of blockchain technology can reduce the operating costs of financial institutions, improve economic efficiency, and solve problems such as information asymmetry. The new financial business model of "blockchain+finance" is conducive to improving the Internet credit reporting system, preventing and controlling Internet financial risks, and further realizing "financial disintermediation". At present, in China's financial field, blockchain technology has been applied and innovated in supply chain finance, cross-border payment, trade finance, asset securitization and other scenarios. To promote the exchange and development of blockchain, information technology and financial experts and scholars. The 2nd International Academic Conference on Blockchain, Information Technology and Smart Finance (ICBIS 2023) will be held in Hangzhou from February 17 to 19, 2023. This conference mainly focuses on the latest research on "blockchain, information technology and smart finance". This conference brings together experts, scholars, researchers and relevant practitioners in this field from all over the world to share research results, discuss hot issues, and provide participants with cutting-edge scientific and technological information, so that you can timely understand the development trends of the industry and master the latest technologies, broaden research horizons and promote academic progress.
Author: Giulia Dal Maso
Publisher: Springer Nature
ISBN: 9811568243
Category : Social Science
Languages : en
Pages : 234
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Book Description
This book focuses on the subjectivities of stock market investors to explore tensions within the Chinese state’s engagement in contemporary financial capitalism. It adopts a genealogical method to investigate how the production of foreign-trained financial experts (haigui) and informal experts (sanhu) points to paradoxes in China’s efforts to cultivate financial expertise. Chinese financialisation relates to the state’s project of financialising human capital in reaction to a contractualised labour market and the vanishing welfare state. Through ethnographic inquiry, Dal Maso shows the Chinese stock markets are crucial to the new redistributive regime where wage labour risks losing its primacy. Here, one can observe how the relationship between money and wages in China is being reworked and witness the development of a new economic order in which the state’s legitimacy becomes increasingly dependent on its capacity to jiushi–to rescue the market in times of crisis.
Author: Danilo Campanella
Publisher: Youcanprint
ISBN: 883163237X
Category : Political Science
Languages : en
Pages : 80
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Book Description
European society - increasingly old, sick and tired - is succumbing. Is it destined to death? In this book, thanks to the intervention of some experts, we will see what are the characteristics of the new society in transformation. What are the new horizons we are about to see. The European continent is in crisis. Europe is transforming. The decrease of the young and the increase of the elderly Europeans is leading to an increase in healthcare spending, a career and financial crisis. At the same time, new migration flows are bringing new diseases and new crime. The western and eastern ones are two worlds that meet but due to the rapidity of this meeting, it risks being a clash in which Europe will be defeated by the high African demography and the economic-financial power of China. Not only is Europe changing: the whole world is changing. Let's see how and why.
Author: Guoping Li
Publisher:
ISBN:
Category :
Languages : en
Pages : 18
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Book Description
Using hand-collected data on IPOs by private-owned enterprises, this article examines the regulatory benefits of political connections in China's state-controlled going public process, a subject that has rarely been investigated in existing literature. This article makes the following findings: first, political connections have significant positive impact on enterprises' chances of being approved for IPOs; second, enterprises with political connections are significantly more likely to receive preferential treatments (e.g., higher offering price-to-earning ratio) from regulatory authorities; third, enterprises with political connections are significantly less likely to be selected for pre-IPO on-site auditing by regulatory authorities. The findings of this article may provide answer to the question why China has been so reluctant to adopt disclosure-based regulatory regime as well as insights into the puzzle of the consistent poor performance of China's stock markets.
Author: Edmund Terence Gomez
Publisher: CUP Archive
ISBN: 9780521663687
Category : Business & Economics
Languages : en
Pages : 252
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Book Description
This book uses the concepts of rent and rent-seeking to study Malaysian political economy.
Author: Mark Petticrew
Publisher: John Wiley & Sons
ISBN: 1405150149
Category : Psychology
Languages : en
Pages : 352
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Book Description
Such diverse thinkers as Lao-Tze, Confucius, and U.S. Defense Secretary Donald Rumsfeld have all pointed out that we need to be able to tell the difference between real and assumed knowledge. The systematic review is a scientific tool that can help with this difficult task. It can help, for example, with appraising, summarising, and communicating the results and implications of otherwise unmanageable quantities of data. This book, written by two highly-respected social scientists, provides an overview of systematic literature review methods: Outlining the rationale and methods of systematic reviews; Giving worked examples from social science and other fields; Applying the practice to all social science disciplines; It requires no previous knowledge, but takes the reader through the process stage by stage; Drawing on examples from such diverse fields as psychology, criminology, education, transport, social welfare, public health, and housing and urban policy, among others. Including detailed sections on assessing the quality of both quantitative, and qualitative research; searching for evidence in the social sciences; meta-analytic and other methods of evidence synthesis; publication bias; heterogeneity; and approaches to dissemination.
