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Purpose – The purpose of this paper is to examine the incremental information content of audit opinion while considering opinion determinants, such as auditor and auditee size, or a firm’s financial state. Design/methodology/approach – A market valuation model is employed using US firm data collected over 30 years. The model relates stock returns to earnings and incorporates as additional variables auditors’ opinion types, opinion determinants and their interactions with audit expression. Findings – The findings suggest that audit opinion has a significant market impact. The estimated positive or negative information content of the audit opinion types is associated with certain opinion determinants, such as auditor and auditee size and a firm’s financial state. Research limitations/implications – Additional firm-year observations regarding certain opinion qualifications could benefit future research. Practical implications – This study offers useful insights by demonstrating the importance of auditing profession to the users of financial statements. It examines investors’ perception of each audit opinion type and the conditions under which this expression has the most serious effects. The results demonstrate the role of audit opinion and its cause-effect relationship with various economic events, allowing regulators not only to track the efficiency of various audit policy changes but also act preventively and amend the regulatory framework. Originality/value – This paper empirically supports the significance of the auditing process and audit opinions by examining investor perceptions. It employs a value relevance model, in contrast to market-based research that adopts an event study methodology. [ABSTRACT FROM AUTHOR]

The increasing pressures in the environment and the environmental social awareness have produced the need for studying interactions between the sectors of the economy and the environment. For a more comprehensive evaluation of sustainability and growth, the field of financial accounting needs to be expanded in order to comprise the use of natural resources and losses in the production process. The paper examines and proposes the cost–benefit analysis model as a useful estimation method of environmental revenues and costs incurred in Greece. These revenues and costs will appear in the profit and loss account statement. Environmental tax is an important cost for all industries with sustainable growth. Taxes are imposed on the natural units, which have a determined negative effect on the environment. Moreover, this paper examines the inherent interaction between the environment and the economic performance of enterprises by adopting environmental management and information green accounting systems. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]