Crisis and controls: the Italian model

Provasi, Roberta; Riva, Patrizia

doi:10.22495/cocv11i1c4art6

Cited by 8 publications

(4 citation statements)

References 7 publications

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“…Furthermore, based on our results, auditing professionals should place greater emphasis on their roles within the restructuring context and exchange increased information with the involved parties, as prompted by Provasi and Riva (2013). International legislators and regulators are advised to enhance the quality and quantity of information available to creditors during RPs by regulating the exchange of information and mandating evidence of such exchange.…”

Section: Discussionmentioning

confidence: 99%

“…The literature demonstrates that audit quality is associated with higher financial reporting quality (Alzoubi, 2018), improved internal control systems (Blokdijk et al , 2006) and an enhanced exchange of financial information among stakeholders (Provasi and Riva, 2013). Thus, we assume that audit quality is particularly relevant in a complex situation, such as debt restructuring.…”

Section: Discussionmentioning

confidence: 99%

“…Indeed, a high-quality audit is pivotal in ensuring the accuracy of financial reporting (DeFond and Zhang, 2014), which, in turn, serves as the foundation of an accurate restructuring plan. High-quality auditors can offer valuable guidance to the debtor company during the financial-disclosure process and effectively exchange information with the involved professional advisors, such as the JT and the IE (Provasi and Riva, 2013), ultimately enhancing the credibility of the plan. Moreover, when an audit opinion is issued before the plan confirmation, creditors are more likely to consider it as an additional factor on which to base their decision regarding the plan, especially when it is expressed by high-quality auditors.…”

Section: Discussionmentioning

confidence: 99%

“…Therefore, increasing information exchange among the different parties involved in PACs could reduce information asymmetry between creditors and debtors. However, research has indicated that the exchange of information between the IE and the auditor is low, and is even lower if the audit is performed by statutory auditors when compared with external auditors (Provasi and Riva, 2013).…”

Section: Background and Hypothesis Developmentmentioning

confidence: 99%

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Audit quality and debt restructuring: evidence from Italy

Magri,

Marchini

2023

MAJ

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Purpose This study aims to investigate the link between audit quality and in-court debt restructuring. The aim is to understand whether the confirmation of debt restructuring plans is affected by audit quality, which, in the light of agency theory, reduces information asymmetries between outsiders (creditors and the court) and insiders (shareholders and managers) of the debtor company. Design/methodology/approach A logistic regression is performed to test whether higher audit quality is associated with an increased probability of successfully completing a debt restructuring proceeding (RP). Consistent with the literature, audit quality is assessed ex ante based on auditor size, which is used as a proxy for independence. The analysis considers private Italian companies. Findings Audit quality positively affects debt restructuring. Among financially distressed companies, those audited by an audit company are more likely to succeed in RPs than those audited by a single practitioner. There is no evidence of a Big N effect. Originality/value This study fills a gap in literature as, in contrast to other financial and governance characteristics, audit quality has never been studied before as a determinant of efficient restructuring. It contributes to the literature on auditing and governance by highlighting the importance of audit quality in complex situations such as RPs, and it expands on debt restructuring literature by considering the importance of the information exchanged during RPs.

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Section: Discussionmentioning

confidence: 99%

Section: Discussionmentioning

confidence: 99%

Section: Discussionmentioning

confidence: 99%

Section: Background and Hypothesis Developmentmentioning

confidence: 99%

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Audit quality and debt restructuring: evidence from Italy

Magri,

Marchini

2023

MAJ

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Editorial: The recent trends in corporate governance research

Allini

2021

CGSR

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Legal account auditing in the corporate system of Chinese listed companies relevance and implications

Provasi¹,

Riva²

2014

COC

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In recent years, the People’s Republic of China has enjoyed strong growth that has attracted the attention of the whole world. In particular, the event that marked a significant development of the Chinese economy has been the entry into the WTO in 2001. This has triggered the opening of China to foreign investment and the gradual liberalization of foreign companies in the Chinese domestic market. The presence of foreign investors and foreign companies in China has increased the demand for higher quality in the standard of auditing and an acceleration of the process of international convergence. To this end, China over the years has continued its project of alignment with the international rules and in 2008 published the new CSA (Chinese Standards on Auditing) and in 2010 in accordance with the principle of global and continues convergence the CASB (China auditing Standards Board) has completed its review of the CSA achieving full convergence with the Clarified ISAs. The aim of this research is to investigate the current scenario of the system of statutory audit in the People’s Republic of China, the degree of development of auditing system highlighting the differences and peculiarities of the audit through an empirical analysis that involved the companies composing the index CSI 300 the 300 most highly capitalized companies, 95 of which are listed on the Shenzhen Stock Exchange and 205 on the Shanghai Stock Exchange. The analysis showed that there is a strong presence of local auditing firms, almost half of the companies listed on the CSI 300 are audited by domestic firms. With regard to the presence of foreign companies, it was found that foreign companies not belonging to the big four are the most representative. In fact only 76 companies are audited by the Big Four.

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Crisis and controls: the Italian model

Cited by 8 publications

References 7 publications

Audit quality and debt restructuring: evidence from Italy

Audit quality and debt restructuring: evidence from Italy

Editorial: The recent trends in corporate governance research

Legal account auditing in the corporate system of Chinese listed companies relevance and implications

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