The Impact of Audit Report on Stock Returns and Closing Prices Of Firms Listed at Damascus Securities Exchange

Abstract

This study aims to test the impact of the external auditor’s amendments on the audit report of the listed companies in Damascus Securities Exchange (DSE) for the period from 2010 to 2020 on the abnormal returns and share closing price. The study included the revised external auditor’s report with paragraph and the qualified external auditor’s report. This study follows the event study method. This study is considered the first study at Damascus Securities Exchange (DSE) that uses the event study method to investigate the investors' reaction to the issuance of the auditor's report modified by paragraph and qualified. This study concluded that there is no effect of the audit report amendments on the returns and prices of shares in the Damascus Securities Exchange. This study also concluded that there is a need to raise awareness among investors regarding the audit process, its results, and the role of the auditor.