A recent FASB standard requires an entity's management to assess the entity's ability to continue as a going concern and disclose substantial doubt about such. In contextualized experiments wherein the entity's auditor does not issue a going concern opinion and the entity subsequently fails, we...

This study examines how nonprofessional equity investors value variations in audit quality at different levels of audit clients’ pre-audit financial reporting quality. Using source credibility theory, we predict that nonprofessional investors will value the greater reduction in information...