UUM Electronic Theses and Dissertation
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Audit Quality and IPO Underpricing

Tengku Rahimah, Tengku Arifin (2010) Audit Quality and IPO Underpricing. Masters thesis, Universiti Utara Malaysia.

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Abstract

This study extends the previous researchers on the underpricing by examining the association between audit quality and level of underpricing. The data are from 152
companies listed on Bursa Malaysia from the period of 2005 to 2009. The level of underpricing in Malaysia is 14.77% during the period. The study specifically investigates the impact of audit quality proxied by Big 4 audit firms, industry-specialized audit firms and international audit firms. The finding of this study indicates that Big 4 auditor including its local affiliates is significantly and positively associated with underpricing. However, if the affiliates are excluded in measuring the Big 4 auditor, it is significantly and negatively associated with underpricing. While the others proxies (industry-specialized
auditor and international auditor) are negatively associated with underpricing. The result implies that Malaysian investors differentiate the services provided by Big 4 and local firms. They assume the quality of the audit to be lower if there is an involvement by the local firms in the audit processes. Besides, the underwriter reputation
is also significantly associated with underpricing, indicating that the ex ante uncertainty do not reduce although the reputable underwriter is engaged by the IPO companies.

Item Type: Thesis (Masters)
Supervisor : Ahmad Zaluki, Nurwati Ashikkin
Item ID: 2528
Uncontrolled Keywords: Audit quality, Underpricing, IPO, Malaysia
Subjects: H Social Sciences > HG Finance
Divisions: College of Business (COB)
Date Deposited: 22 Nov 2011 08:21
Last Modified: 24 Jul 2013 12:16
Department: College of Business
Name: Ahmad Zaluki, Nurwati Ashikkin
URI: https://etd.uum.edu.my/id/eprint/2528

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