Disclosure of key audit matters with cumulative abnormal return : Case study of companies listed on the stock exchange of Thailand (SETHD)

Abstract

          The purpose of this study was to examine the relationship between the disclosure of key audit matters in the auditor's report and the cumulative abnormal return. Companies listed on the Stock Exchange of Thailand (SETHD), the researcher used the event study method, Collected data from the annual report and financial statements for the year 2016 - 2020 for total of 28 companies. The researcher analyzed by using multiple regression analysis to analyze the relationship between the number disclosures of key audit matters for examining in the auditor's report and securities prices through measurements of accumulate abnormal return.

          The result of studying found that disclosures of key audit matters were associated with a statistically significant cumulative abnormal return at the 0.05 level, the investors responded to the auditor's report before and after 5 business days of the announcement date.

          In addition, the test result showed that investors reacted to Key Audit Matters at the time of the announcement caused investors to know the importance of disclosing key audit matters in the auditor's report and increase the value of communicating the auditor's report more affects investment decisions because investors can definitely profit from predicting the direction of the return.