Skip to main content
User Image

د. يحيى بن علي بن أحمد الجبر Dr. Yahya Al Jabr

Associate Professor

قسم المحاسبة

كلية إدارة الأعمال
216
publication
Journal Article
2016

Joint Audit and Cost of Equity Capital: Evidence from Saudi Arabia

Aljabr, Nasser Alsadoun and Yahya . 2016

Article 14 of the Saudi Banking Control Law (1966) and Article 10 of the Saudi Cooperative Insurance Companies Control Law (2003) state that auditing by two independent auditors is mandatory for banks and insurance companies. These joint audit regulations are aimed at improving the independence of the auditor. In accordance with Article 130 of the Saudi Companies Law, in recent years few Saudi-listed firms, other than firms in the banking and insurance industries, have voluntarily appointed two independent auditors. We examine whether Saudi investors require a lower rate of return for investing in firms with two independent auditors as opposed to firms with a single auditor, and whether the rate varies by audit quality of the two appointed auditors as proxied by industry specialist auditors. Our main results suggest that the expected cost of equity and the implied cost of equity, our proxies for the required rate of return, are decreasing in firms that engage two independent auditors as opposed to firms that engage a single auditor. In addition, our results suggest that cost of equity measures are even lower if both of the two appointed auditors are industry specialists. The results of additional analyses suggest that the main findings are driven primarily by the sample of firms that are subject to mandatory regulations.
 

Publication Work Type
بحث
Volume Number
33
Issue Number
1
Magazine \ Newspaper
Forthcoming, Journal of King Abdulaziz University : Economics and Administration
Pages
1-35
more of publication
publications

Article 14 of the Saudi Banking Control Law (1966) and Article 10 of the Saudi Cooperative Insurance Companies Control Law (2003) state that auditing by two independent auditors is mandatory for…

by Nasser Alsadoun and Yahya Aljabr
2016
publications

هذا البحث يهدف إلى دراسة تأثير المراجعة المشتركة على جودة الأرباح المحاسبية للشركات المسجلة في سوق الأوراق المالية السعودي. وقد توصل البحث إلى عدم وجود تأثير للمراجعة المشتركة على جودة الأرباح…

by د. يحـيى بن علي الجــبر و د. ناصر بن محمد السعدون
2014