Title page for ETD etd-02222017-162323

Type of Document Dissertation
Author Park, Jung Eun
Author's Email Address jpar112@lsu.edu
URN etd-02222017-162323
Title The Pricing of IPO Audit Expertise and Subsequent Issuer Underpricing
Degree Doctor of Philosophy (Ph.D.)
Department Accounting
Advisory Committee
Advisor Name Title
Reichelt, Kenneth Committee Chair
He, Shan Committee Member
Massel, Norman Committee Member
Chanda, Areendam Dean's Representative
  • underpricing.
  • audit fees
  • auditor specialization
  • initial public offerings
Date of Defense 2017-02-09
Availability unrestricted
I examine the costs and benefits to the issuer of hiring an IPO auditor specialist in the U.S. Initial Public Offerings market. I quantify IPO auditor expertise at the market share level and the market concentration level and then I investigate the audit fees of IPO audit expertise and the issuer underpricing in the U.S. IPO market. I find that there are significant fee premiums when an audit firm is a national IPO audit specialist and when an audit office is a city IPO audit specialist. I also find that IPO specialist auditors reduce first-day issuer underpricing. These results are robust to controlling for extant endogeneity with respect to choice of auditor. This paper contributes to both the auditor specialization literature and the IPO literature by investigating IPO audit specialization. This study also provides useful information to IPO market participants, such as issuers, investors, auditors, and regulators.
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