Research On The Impact Of Disclosure Of Key Audit Matters On Corporate Debt Financing Cost

In December 2016,the Ministry of finance of China issued Auditing Standards No.1504-Communicating of Key Audit Matters in Audit Reports,requiring disclosure of key audit matters.The purpose of this reform is to improve the information content and communication value of audit reports,so as to provide incremental information for enterprise stakeholders to make decisions.Creditors are important stakeholders of the enterprise.In the view of creditors,the premise of borrowing is to estimate that the principal can be recovered and interest income can be obtained in the future,so it is very important to control the risk of borrowing,and enterprise financial reports and audit reports are important sources of information.Therefore,starting from the key audit matters,this paper explores its impact on the cost of corporate debt financing.This paper selects all A-share listed enterprises from 2017 to 2020 as samples.After obtaining the data of key audit matters,this paper uses Python for text analysis to obtain the complexity,accuracy and other relevant index information of key audit matters,and makes empirical analysis.The conclusions are as follows:(1)Key audit matters can lead to an increase in debt financing costs.(2)In enterprises with high operational risk,high financing constraints,non-state-owned,low information transparency and low audit quality,key audit matters are more likely to cause the rise of enterprise debt financing cost.(3)If goodwill and related party transactions key audit matters are disclosed,the cost of corporate debt financing will increase significantly.The possible innovations of this paper are as follows:first,from the perspective of research,starting from the two paths of risk signal transmission and psychology,this paper studies the impact mechanism of key audit matters on debt financing cost,increasing the economic consequences caused by key audit matters,broadening the research perspective of information disclosure and corporate debt financing cost.Second,in terms of index measurement,it subdivides the disclosure characteristics of key audit matters,measures the disclosure characteristics of key audit matters from the number,complexity,accuracy and text length,and also analyzes through multiple adjustment variables and different types of key audit matters,which is the deepening and expansion of the existing research.Third,in terms of research ideas,this paper takes the audit report reform as the starting point to study the impact of key audit matters on enterprise debt financing costs,supplemented by different regulatory variables for further research,so as to provide new ideas for the research of debt financing costs.