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- Publisher
- Wiley
- Copyright
- Copyright © 2005 Wiley Subscription Services, Inc., A Wiley Company
- ISSN
- 0046-3892
- eISSN
- 1755-053X
- DOI
- 10.1111/j.1755-053X.2005.tb00121.x
- Publisher site
- See Article on Publisher Site
Abstract
The certifying and monitoring role of auditors is valuable to clients. By examining the impact of Arthur Andersen's worsening reputation on its clients, we find a 200 basis point more negative reaction to seasoned equity offering (SEO) announcements for firms audited by Andersen. The median firm in our sample loses 31.4 million more than a non‐Andersen client. We do not find any unusual underpricing for these SEOs, which suggests that any accounting concerns about the issuers are resolved before the issue dates.
Journal
Financial Management – Wiley
Published: Dec 1, 2005