A large negative stock price reaction to a restatement announcement could imply a particularly significant accounting error, or one made by a firm that has a relatively high probability of being sued. This paper investigates the extent to which market reactions to restatement announcements are...

This paper examines whether firms' auditor choice affects their ability to access foreign equity capital. Using the equity holdings of 34,837 foreign mutual funds from 28 countries, we find evidence that appointing a Big 4 auditor increases the level of foreign mutual fund ownership in firms....