We study the impact of shareholder-initiated litigation risk on a firm's stock price crash risk. Our empirical analysis takes advantage staggered adoption universal demand laws, which led to an exogenous decline in derivative find that threat reduces and information hoarding associated with earnings management is channel through affects The relationship also moderated by how exposed firms are o...

Abstract Using manually collected data on the number and category of critical audit matters (CAMs) in period 2016–2017, we investigate hitherto unexplored questions whether CAMs affect firm-specific crash risk, how influence risk Chinese capital market, recognize that contain incremental information. Our findings are as follows: (1) Crash decreases after implementing new standard requiring disc...