Auditing Firm Reputation and the Post-IPO Operating Performance in an Emerging Market: Evidence from Turkish IPO Firms

ER B., Çankaya F., BULUT H. İ.

Investment Management and Financial Innovations, vol.6, no.3, pp.212-229, 2009 (Scopus)

  • Publication Type: Article / Article
  • Volume: 6 Issue: 3
  • Publication Date: 2009
  • Journal Name: Investment Management and Financial Innovations
  • Journal Indexes: Scopus
  • Page Numbers: pp.212-229
  • Karadeniz Technical University Affiliated: Yes


It is a priori belief that the auditing firm reputation provides information about the issuing firm’s true value in the initial public offering(IPO) markets. We analyze the auditing firm reputational role in the Istanbul Stock Exchange(ISE). We, in the course of doing so, basically compare the post-issue operating performance of high-reputable auditing firm-backed and low-reputable auditing firm-backed IPOs. We also investigate the relationship between the auditing firm reputation and the post-issue operating performance with regard to underpricing, the management ownership level, and investment banker reputation. We, int he last section of the study, explore whether the market recognizes the third party reputational role of the auditing firm in the ISE.