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Full-Text Articles in Business Administration, Management, and Operations
Do Industry Specialist Auditors Add Value In Mergers And Acquisitions?, Ho-Young Lee, Vivek Mande, Jong Chool Park
Do Industry Specialist Auditors Add Value In Mergers And Acquisitions?, Ho-Young Lee, Vivek Mande, Jong Chool Park
Accounting Faculty Publications
This study examines whether the stock market returns surrounding announcements of mergers and acquisitions (M&A) are higher for acquiring firms audited by industry specialists. External auditors are uniquely positioned to provide assurance on the financial statements of their acquiring clients both before and after an acquisition. Also, an important aspect of due diligence in M&A transactions is the external auditors review of the accounting records, financial statements, internal controls and information systems of the target company. Using a sample of 4,283 M&A announcements between 1988 and 2011 in the United States of America, we report the results from our main …