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Registration system reform and risk of stock price collapse: the mediating effect based on auditor reputation

Author

Listed:
  • Yang, Junhua
  • He, Xing
  • Zhang, Menghao
  • Gao, Xinxiang
  • Gou, Congcong
  • Chen, Xilong

Abstract

Against the institutional backdrop of registration system reform, this study examines how it influences stock price crash risk through the channel of auditor reputation. Using the implementation of the registration system reform on the ChiNext board as a natural experiment, the empirical findings demonstrate that the reform significantly reduces stock price crash risk. Mechanism analysis reveals that enhancing auditor reputation serves as a significant channel, confirming the presence of a partial mediating effect. Furthermore, corporate risk-taking and accounting conservatism positively moderate the reform’s mitigating effect on crash risk. Heterogeneity analysis indicates that the policy effect is more pronounced among firms with stronger corporate governance and higher media coverage. This study not only provides micro-level evidence on the policy outcomes of registration system reform but also elucidates the transmission mechanism of auditor reputation, offering important implications for deepening capital market reforms.

Suggested Citation

  • Yang, Junhua & He, Xing & Zhang, Menghao & Gao, Xinxiang & Gou, Congcong & Chen, Xilong, 2026. "Registration system reform and risk of stock price collapse: the mediating effect based on auditor reputation," Finance Research Letters, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:finlet:v:90:y:2026:i:c:s154461232502570x
    DOI: 10.1016/j.frl.2025.109321
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    Keywords

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    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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