ISSN: 2225-8329
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This study aimed to investigate the market reaction to the release of the independent auditor's opinion accompanied by going concern modification (GCM) whether the type of report is unqualified or a qualified audit opinion. The study population consisted of all public shareholding companies listed on the Amman Stock Exchange (ASE) except for the financial sector while the study sample consisted of those companies whose auditor's report included a GCM for the period 2017-2021. The event study method was used to analyze the market's reactions measured by CAARs. we used a short event window of 15 days;7 days before and after the release of the audit report, in addition to day zero in which the announcement is made. The data for the study was collected manually through the financial reports and through the market bulletin published on the ASE website. The study used a non-parametric one-sample T-test to examine the hypotheses. The results revealed that there was no statistically significant effect of the going concern audit opinion on the stock prices whether accompanied by unqualified or qualified audit reports. These results can be justified based on the argument of Blay & Gregor (2001), who reported that the market may not be affected significantly by the expected going concern opinion, while the market will react significantly and negatively to unexpected modifications, It is worth noting that the Corona pandemic has permeated the current study period, and therefore the investor may have a high expectation of financial distress that may affect going concern assumption, therefore, we recommend that this study be extended in other periods.
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In-Text Citation: (Altawalbeh & Alroud, 2023)
To Cite this Article: Altawalbeh, M. A., & Alroud, L. (2023). Going Concern Audit Opinion and Market’s Reaction. International Journal of Academic Research in Accounting Finance and Management Sciences, 13(2), 650–664.
Copyright: © 2023 The Author(s)
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