The Value of Big N Target Auditors in Corporate Takeovers

45 Pages Posted: 24 Nov 2009 Last revised: 29 Jul 2014

See all articles by Yuan Xie

Yuan Xie

Fordham University

Han Yi

Korea University

Yinqi Zhang

American University

Date Written: January 23, 2013

Abstract

Using a large sample between 1987 and 2006, we document that firms with Big N auditors are; 1) more likely to become M&A targets, and 2) more likely to be ultimately acquired in M&A deals. Cross-sectional analyses further suggest that the effects of Big N target auditors on the likelihood of becoming targets and on deal completion rates are more pronounced for firms with low accruals quality (our proxy for high information risk). Overall, the results emphasize the important role that Big N target auditors play in facilitating M&A transactions.

Keywords: M&A Targets, Big N Auditor, Mergers and Acquisitions

JEL Classification: M41

Suggested Citation

Xie, Yuan and Yi, Han and Zhang, Yinqi, The Value of Big N Target Auditors in Corporate Takeovers (January 23, 2013). Auditing: A Journal of Practice & Theory, Vol. 32, No. 3, 2013. Available at SSRN: https://ssrn.com/abstract=1465151 or http://dx.doi.org/10.2139/ssrn.1465151

Yuan Xie

Fordham University ( email )

441E Fordham Road
Bronx, NY 10458
United States

HOME PAGE: http://www.fordham.edu/info/22941/full-time_faculty/4970/yuan_xie

Han Yi (Contact Author)

Korea University ( email )

Main Business Building 402
Korea University Business School
Seoul, 136-701
+82-2-3290-2629 (Phone)

Yinqi Zhang

American University ( email )

4400 Massachusetts Ave NW
Washington, DC 20016
United States

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