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Measuring and analyzing the information entropy value of key Audit matters (KAMs) disclosure at the system and reporting scale by Jintian Lin is a Medicine article available to read on EtoBox.

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Drawing upon information entropy theory, this study deduces a measurement formula for the information entropy for key audit matters (KAMs) disclosure, considering both system scale and audit report scale. The information entropy of an audit report within a specific system is calculated as the weighted average logarithm value of the continuous product of KAM disclosure frequencies. Subsequently, a systematic calculation of KAM disclosure information entropy is conducted using 14,837 financial statement audit reports from listed companies traded on the Shanghai and Shenzhen Stock Exchanges, covering the FY 2017-20 period. The findings indicate that: (1) The information entropy of KAM disclosure has decreased from 2017 to 2020, while the homogenization degree of KAM disclosure has increased. (2) The information entropy and evenness of KAM disclosure on the main board are significantly higher than those of the ChiNext and the STAR Market. (3) The transportation, storage and postal services, manufacturing, finance, power supply, heating, gas and water supply industries exhibit the highest overall information entropy of KAM disclosure, indicating good quality. (4) The information entropy

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Author

Jintian Lin

Publisher

Elsevier

Published

2023

Language

EN

Field

Medicine (Physical Sciences)