The Covid-19 pandemic and the measures introduced to prevent its further spread have undoubtedly led to significant business uncertainties regarding the going concern principle. Not only has the global economy experienced negative effects of the pandemic, but a number of professions as well,...

An administrative fine is a monetary penalty that may be imposed by a supervisory authoritity as an administrative punishment. Such a fine adversely interferes in the cash flow generation of the company in question. The fine can be described as an investment carrying opportunity costs with no...

An administrative fine is a monetary penalty that may be imposed by a supervisory authoritity as an administrative punishment. Such a fine adversely interferes in the cash flow generation of the company in question. The fine can be described as an investment carrying opportunity costs with no...

We provide insights into how the market processes going concern audit opinions based on the trading of some well-documented sophisticated investors—short sellers. We find that abnormal short selling increases significantly upon impending going concern disclosures. While prior literature...

We study asset and debt characteristics of US banks. We show that financial institutions, especially large institutions, are not just about holding assets that can be directly pledged and "pawned." Services and going-concern values are important, and capital market debt against going-concern...

Using multiple indicators of audit quality, the study examines the impact of audit partner rotation on audit quality in India based on 1,694 firm years for the period of 2011-2017 when the institutional set up for audit partner rotation was voluntary. The empirical results indicate that the...

Die Unabhängigkeit des Abschlussprüfers ist von anhaltender Relevanz, wird jedoch immer wieder in Frage gestellt. Der Fokus von Regulierungsbehörden und Forschung liegt auf kapitalmarktorientierten Unternehmen. Die Unabhängigkeit kann besonders gefährdet sein, wenn Schutzmechanismen, wie z....

Auditors' propensity to issue Going Concern Audit Reports (GCARs) is one of the proxies often used for audit quality. Although this propensity is a distinguishing characteristic of auditors, it does not indicate quality according to both theory and practice. In theory, higher-quality auditors...

We study asset and debt characteristics of US bank holding companies. We show that financial institutions, especially large institutions, are not just about holding discrete assets. Services and going-concern values are important, and capital market debt against going-concern values accounts for...

Die Unabhängigkeit des Abschlussprüfers ist von anhaltender Relevanz, wird jedoch immer wieder in Frage gestellt. Der Fokus von Regulierungsbehörden und Forschung liegt auf kapitalmarktorientierten Unternehmen. Die Unabhängigkeit kann besonders gefährdet sein, wenn Schutzmechanismen, wie z....

We document an increase in auditors issuing going-concern opinions in Australia over a prolonged period since the Global Financial Crisis that is not fully explained by changes in client risk. Overall, our evidence is consistent with auditors reporting more conservatively with the increased...

Structural liquidity risk is a material risk resulting from the core banking business of taking in short-term deposits and lending out long-term loans, thus allowing a maturity mismatch between assets and liabilities. At some point the long-term loans will require refinancing and the institution...

Purpose: The purpose of this paper is to discuss the inheritance of a business from the Islamic accounting perspective. Design/methodology/approach The paper adapts the relevant provisions of conventional accounting standards and practices that conform to Sharīʿah (Islamic law). In addition,...

We analyze how variation in federal level legal liability associated with judge ideology affects the likelihood of firms receiving going-concern modified audit opinions. With auditors trading off between Type I and Type II reporting errors, the threshold value (of client bankruptcy probability)...

After a lengthy and protracted debate, the Public Company Accounting Oversight Board (PCAOB) adopted new rules and related amendments to its auditing standards regarding the engagement partner and other accounting firms that took part in the audit (PCAOB 2015). The rules require disclosure of...

This paper examines the relation between gender diversity on the board of directors and the likelihood that a company receives an emphasis of matter going concern audit opinion. Gender diversity on the board and the audit committee is examined. We find that, after controlling for the strength of...

This study investigates whether auditors use information in accounting estimates when making going concern assessments and whether the usefulness of information in accounting estimates to auditors depends on whether the estimate is prepared following a rule-based standard or a principle-based...

In this study we predict and provide evidence that distressed firms that rely more heavily on major customers for sales have a comparatively higher incidence of receiving going concern opinions (GCOs). Moreover, we find that the effect of increased reliance on major customers is driven by firms...