Effects of Audit Quality on Earnings Management and Cost of Equity Capital: Evidence from China

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  • Accepted by Michel Magnan. We thank Michel Magnan, Gordon Richardson, Dan Simunic, Shifei Chung, Bin Srinidhi, Zhifeng Yang, two anonymous reviewers, and workshop participants at City University of Hong Kong, University of Houston, Xiamen University, the 2008 American Accounting Association Annual Meeting, the 2008 Annual Congress of the European Accounting Association, and the 2009 China Accounting and Finance Review International Symposium for helpful comments. Hanwen Chen acknowledges financial support from the National Nature Science Foundation of China (NSFC-70672101) and the National Philosophy and Social Science Foundation of China (07BJY027). Yanyan Wang acknowledges financial support from the National Nature Science Foundation of China (NSFC-71002043) and the Education Ministry (08JC630074).

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