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The Insurance Hypothesis and Market Prices.

Krishnagopal Menon; David D. Williams

The Accounting Review 1994

Examines the effect Laventhol & Horwath's (L&H) disclosure of their auditor's bankruptcy and the appointment of a successor auditor on the company's stock prices. Insurance hypothesis; Investors' assignment of a value to the right to recover investment losses from the auditor; Adverse effect of bankruptcy disclosure on market prices of L&H clients.

DOI
10.2308/tar-9412141412
Volume
69 (2)
Pages
327-342
Language
en
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