China’s Sarbanes-Oxley Act (China-SOX): Evidence on its Economic Consequences and its Effects on Company Efficiency

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dc.contributor.advisor Hay, D en
dc.contributor.advisor Harrison, J en Wang, Yitian en 2017-09-04T00:34:52Z en 2017 en
dc.identifier.uri en
dc.description Full text is available to authenticated members of The University of Auckland only. en
dc.description.abstract In 2012, the Chinese version of the Sarbanes-Oxley Act (the China-SOX) was officially enacted. Inspired by the controversies among the US academic and business communities regarding the costs of compliance with the SOX-type legislation, this thesis examines whether the total private benefits of the enactment of China-SOX exceed its total private costs. In this thesis, the China-SOX is evaluated from two perspectives which are: 1) whether market investors perceive the enforcement of China-SOX as beneficial overall as reflected by the movements of stock prices, and 2) whether implementing China-SOX guidelines can lead to an improvement in company productivity and efficiency in the post-China-SOX period. The overall economic consequences of the enactment of China-SOX is examined via an event study which detects if there are significant market returns as well as stock returns around the dates of key China-SOXrelated events during the legislation preparation period. The effect of China-SOX on companies’ productivity and efficiency is examined in a DEA study setting, and Malmquist Index Analysis is conducted to find the productivity and efficiency changes between the pre-China-SOX period and the post-China-SOX period. The event study results provide no evidence to support the claim that the enactment of China-SOX is net beneficial. However, the results show that there are significant negative market returns around one of the China-SOX announcement events. Meanwhile, the results also suggest that, around the dates of the same China-SOX event, the returns of the mainboard listed companies that did not voluntarily disclose internal control audit opinions are significantly lower than the main-board listed companies with such disclosure. Both findings seem to add validity to the concern about the costs of China-SOX’s compliance. The DEA study results provide mixed evidence regarding the effect of China-SOX on company efficiency, as some of the sample industries show an overall efficiency improvement from the pre-China-SOX period to the post-China-SOX period whereas other industries show an overall efficiency decline. Collectively, the results of the event study and the DEA study do not support the claim that China-SOX is net beneficial. en
dc.publisher ResearchSpace@Auckland en
dc.relation.ispartof Masters Thesis - University of Auckland en
dc.relation.isreferencedby UoA99265048713502091 en
dc.rights Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. en
dc.rights Restricted Item. Available to authenticated members of The University of Auckland. en
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dc.title China’s Sarbanes-Oxley Act (China-SOX): Evidence on its Economic Consequences and its Effects on Company Efficiency en
dc.type Thesis en Accounting en The University of Auckland en Masters en
dc.rights.holder Copyright: The author en
pubs.elements-id 657368 en
pubs.record-created-at-source-date 2017-09-04 en

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