The Price of control: pandemic lockdowns and perceived earnings quality

Lin-Hui Yu; Yan-Yu Chou; Rong-Ruey Duh; Jengfang Chen

doi:10.1111/acfi.70040

The Price of control: pandemic lockdowns and perceived earnings quality

Lin-Hui Yu, Yan-Yu Chou, Rong-Ruey Duh, Jengfang Chen^*

^*Corresponding author for this work

Department of Accounting and Corporate Governance

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Abstract

In this study, we investigate whether investors perceived earnings quality to be impaired by lockdown policies implemented to control the spread of COVID-19. Using a sample of American Depositary Receipts (ADR) firms, we find that investors perceived earnings quality to be adversely impacted as the lockdown period lengthened. This effect is more pronounced in countries with a history of scandals and among younger companies. Our findings provide valuable insights for stakeholders focused on assessing the impact of COVID-19 on earnings quality.

Original language	English
Pages (from-to)	3291-3309
Number of pages	19
Journal	Accounting and Finance
Volume	65
Issue number	4
Early online date	19 May 2025
DOIs	https://doi.org/10.1111/acfi.70040
Publication status	Published - Dec 2025

Bibliographical note

© 2025 The Author(s). Accounting & Finance published by John Wiley & Sons Australia, Ltd on behalf of Accounting and Finance Association of Australia and New Zealand. Version archived for private and non-commercial use with the permission of the author/s and according to publisher conditions. For further rights please contact the publisher.

Keywords

ADR
auditing
COVID-19
lockdowns
perceived earnings quality

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10.1111/acfi.70040Licence: CC BY-NC-ND

Publisher version (open access)Final published version, 315 KBLicence: CC BY-NC-ND

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The Price of control: pandemic lockdowns and perceived earnings quality

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