Short Seller, Firm, and Auditor Behavior

• 발행기관: People & Global Business Association
• 저자명: 춘정은(Jongeun Chun) 양전선(Joonsun Yang)
• 간행물 정보: 『Global Business and Finance Review』Vol.26 No.3, 51~67쪽, 전체 17쪽
• 주제분류: 경제경영 > 경영학
• 파일형태: PDF
• 발행일자: 2021.09.30

영문 초록

Purpose: Although a small part of arbitrage trading, short selling has a significant impact on capital markets. This study empirically examines relationships among short selling, earnings managements, and auditor behaviors. Design/methodology/approach: We employed short selling and abnormal short selling as independent variables. Audit hours, audit fees, and (absolute) value of discretionary accruals as dependent variables. In this study, we basically include ordinary least-squares regression analyses using panel data and interaction analyses. Findings: This study verifies the relationship among short selling, firm earnings management, and auditor behavior, showing positive relationships between short selling and current and future audit fees, audit hours, and current audit quality. Further, higher audit risk, caused by the interaction between abnormal short selling and aggressive earnings management, is reflected in future audit fees and hours. Research limitations/implications: Due to the financial data provided on an annual basis, the daily short selling data was aggregated on an annual basis. This study suggests that short selling is related to firm earnings management behavior, as well as to the auditor behaviors. Therefore, regulators should consider the impacts of short selling on company and auditors as well as investors. Originality/value: This study provides evidence that the positive relationship between short selling and audit fee is not only caused by risk-premium channels, but also by audit-effort channels. Furthermore, we find that the interaction effects of short selling and earnings managements occur only in abnormal short selling. This seemed to impose penalties on short selling exceeding forecasts when auditors considered earnings managements and short selling at the same time.

목차

Ⅰ. Introduction

Ⅱ. Literature Review

Ⅲ. Hypotheses Development

Ⅳ. Research Design and Sample Selection

Ⅴ. Descriptive Statistics and Empirical Findings

Ⅵ. Conclusions

Acknowledgments

References

키워드

Short selling Earnings management Audit effort Audit fee