Cost of debt for private firms revisited : voluntary audits as a reflection of risk

Ichev, Riste (avtor), Koren, Jernej (avtor), Kosi, Urška (avtor), Sitar Šuštar, Katarina (avtor), Valentinčič, Aljoša (avtor)

We examine the relation between voluntary audit and the cost of debt in private firms. We use a sample of 7,420 small private firms operating in the period 2006-2022 that are not subject to mandatory audits. Firms self-select into voluntary audits because of the economic setting (e.g., ownership complexity, export, subsidiary status) or because firm fundamentals limit their access to financial debt. In the outcome analyses, we find that voluntary audits result in higher, rather than lower, interest rates with increases ranging from approximately 1.7 percentage points, but going higher depending on the exact specification. This effect is present regardless of the perceived audit quality (Big-4 vs. non-Big-4), consistent across auditor types. Audited firms’ earnings are less informative about future operating performance. Voluntary audits facilitate access to financial debt for high-risk firms. The price paid is reflected in higher interest rates for voluntary audits – firms with higher information/fundamental risk.

• Jezik: Angleški jezik
• Ključne besede: private company, internal auditing, indebtedness, risk, risk management, private firms, voluntary audit, cost of debt, self-selection bias
• Vrsta gradiva: Članek v reviji
• Tipologija: 1.01 - Izvirni znanstveni članek
• Organizacija: EF - Ekonomska fakulteta
• Status publikacije: Objavljeno
• Različica publikacije: Objavljena publikacija
• Leto izida: 2026
• Št. strani: 24 str.
• Številčenje: Vol. 109, article no. ǂ105474
• PID: 20.500.12556/RUL-184415
• UDK: 005.336.1
• ISSN pri članku: 1059-0560
• DOI: 10.1016/j.iref.2026.105474
• COBISS.SI-ID: 280069379
• Datum objave v RUL: 06.07.2026

Gradivo je del revije

• Naslov: International review of economics and finance
• Skrajšan naslov: Int. rev. econ. finance
• Založnik: Elsevier
• ISSN: 1059-0560
• COBISS.SI-ID: 1019157

Licence

• Licenca: CC BY-NC-ND 4.0, Creative Commons Priznanje avtorstva-Nekomercialno-Brez predelav 4.0 Mednarodna
• Povezava: http://creativecommons.org/licenses/by-nc-nd/4.0/deed.sl
• Opis: Najbolj omejujoča licenca Creative Commons. Uporabniki lahko prenesejo in delijo delo v nekomercialne namene in ga ne smejo uporabiti za nobene druge namene.

Sekundarni jezik

• Jezik: Slovenski jezik
• Ključne besede: zasebno podjetje, notranja revizija, zadolženost, tveganje, obvladovanje tveganj

Projekti

• Financer: ARIS - Javna agencija za znanstvenoraziskovalno in inovacijsko dejavnost Republike Slovenije
• Številka projekta: P5-0161
• Naslov: Izzivi vlagateljev, podjetij, finančnih institucij in države v negotovem evropskem gospodarskem okolju

• Financer: Drugi - Drug financer ali več financerjev
• Številka projekta: 403041268
• Naslov: TRR 266 Accounting for Transparency