Do Institutional Investors' Investigations Matter?: Empirical Study on Internal Control Quality and Audit Fees

The academic community has carried out a large quantity of research on institutional investors' corporate investigations and found out that they are meaningful to the corporate governance of the corporations investigated. This paper explores the relationship between institutional investors' investigations and internal control as well as audit fees of the A-share listed companies in China through OLS and finds out that the investigations conducted by institutional investors can improve the internal control quality and reduce the audit fees of the target companies.