Journal article

Shades of Gray: Internal Control Reporting by U.S.-listed Chinese Firms

G Biddle, Raymond Reed Baker, Michelle Rene Lowry, Neale G O'Connor

Accounting Horizons | American Accounting Association | Published : 2018

Abstract

Chinese firms listing in the U.S. via reverse mergers (CRMs) have dominated prior media, regulator and research attention. Yet CRMs have effectively ceased, leaving Chinese firms listing via initial public offerings (CIPOs) as the relevant remaining class of Chinese firms listing on U.S. exchanges. This study documents salient differences between CIPOs, CRMs and U.S.-domiciled U.S.-listed firms by examining Sarbanes-Oxley Act Section 302 and 404(b) ineffective internal control (IIC) and related disclosures that underlie financial reporting quality, with three main sets of findings. First, both CIPOs and CRMs are more likely to report IICs than U.S.-domiciled counterparts. Second, both CIPOs ..

View full abstract

University of Melbourne Researchers