Abstract: We examine what motivates a firm to voluntarily disclose its self-assessment on internal control (IC) and further have an audit attestation on this management report using a sample of China’s publicly traded firms during 2006-2010. We find that the likelihood to have voluntary disclosure of IC self-assessment with audit attestation is positively related to the future equity refinancing, the institutional (especially mutual fund) shareholdings, and whether the firm is controlled by the central government. Our study also takes the identification problem into consideration as our sample includes firms with IC weaknesses/deficiencies. Our study not only contributes incrementally to the literature but also has practical implications, especially to regulators and investors.

Person Profile: Professor Qian Sun, first dean of Institute for Financial & Accounting Studies of Xiamen University from 2005 to 2009, received his bachelor's degree in economics at Peking University, an MBA from William Pederson College and his doctorate in economics from Arizona State University in the United States. His research has focused on the stock market and financial fields. Professor Sun has yielded fruitful results, published more than 20 articles in the international professional academic journals, which including 15 in the SSCI indexed journals and an English monograph. Professor Sun published nearly 40 articles on the newspapers and magazines. Ranked seventh in the rankings that the 2004 most abundant Pacific scholars of "Asia-Pacific financial journal".