Global Journal of Management and Business Research, D: Accounting and Auditing, Volume 22 Issue 2

Informational Performance of Audit Reports Content: Case of French Companies Listed on the Stock Exchange during the Decade 2010-2020 12 Global Journal of Management and Business Research Volume XXII Issue II Version I Year 2022 ( )D © 2022 Global Journals Note: Based on the data in Table 6. The points joined by a solid line represent the average cumulative abnormal returns (CMARt). Graph 4: Announcement of reservations and refusal to certify except for the first time iii. The impact of reservations issued on company accounts for the second time According to the standards established by the CNCC, when elements give rise to a reservation from the auditor on the financial statements of a company in a specific year and persist the following year, the latter can mention in his report the reservation expressed previously. Three cases are mentioned in the CNCC standards under the heading of “resumption of reservations and refusal to certify from the previous year.” • The reasons for the reservation or refusal remain: the auditor quantifies the impact on the result and expresses a reservation or refuses to certify the annual accounts. • The reasons for the reservation or refusal no longer exist due to the corrections made by the company, the modifications have affected the result of the current financial year and justified a new reservation. • Corrections made by the company corrected the anomaly without impacting the current result. If the statutory auditor deems it necessary to ensure a follow-up, he may mention it in the context of the observations provided for by the regulations in force. Table 7: Announcement of reservations and refusal to certify issued for the second time Date Excess return T-test Cumulative excess T-test on cumulative -5 -0,21 -0,74 -0,41 -0,01 -4 -0,61 -2,12 -0,62 -0,41 -3 -0,20 -0,69 -0,82 -0,54 -2 -0,63 -2,18 -1,45 -0,93 -1 -0,87 -3,01 -2,32 -1,47 0 -0,01 -0,05 -2,33 -1,45 1 -0,65 -2,27 -2,98 -1,83 2 0,46 1,59 -2,52 -1,53 3 -0,83 -2,88 -3,35 -1,99 4 -0,16 -0,55 -3,51 -2,06 5 0,08 0,28 -3,43 -1,99 Note: Returns (excess and cumulative) are expressed as a percentage. Forty-nine reservations and refusals to certify are used. The assumed announcement date is that of the report’s signature by the auditors. Abnormal returns are defined regarding the market model ( = + + ). To examine the impact of the reservations expressed by the auditors on the financial statements of the companies in the following years, various event tests are carried out. Table 7 shows the average and cumulative abnormal returns around the second event date (date of the signature of the report by the auditor) using the simple market model. It should be recalled that the use of the Dimson model leads to similar results. -5 -4.5 -4 -3.5 -3 -2.5 -2 -1.5 -1 -0.5 0 -6 -4 -2 0 2 4 6 8 10 12 Cumulative excess