A recent academic study lends support to the Public Company Accounting Oversight Board’s regulatory oversight of auditing firms, suggesting it gives investors greater confidence in companies, in turn leading to more capital available to businesses.
The study, by Professor Nemit Shroff of the Massachusetts Institute of Technology’s Sloan School of Management, found that companies issue additional capital amounting to 0.5 percent of assets and increase investment expenditures by 0.3 percent of assets as a result of additional auditor regulatory oversight.
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