Does key audit matters (KAMs) disclosure affect corporate financialization?

This paper aims to clarify the relationship between key audit matters (KAMs) disclosure and corporate financialization. The findings reveal that key audit matters (KAMs) disclosure can provide incremental information value, thereby impeding corporate financialization in China. Moreover, this effect is more pronounced in the samples with low media attention, low institutional investor holdings, and non-state-owned enterprises. Further research indicates that reducing managerial myopia and easing financing constraints serve as key channels through which key audit matters (KAMs) disclosure affects corporate financialization. In addition, the future financialization analysis suggests that key audit matters (KAMs) disclosure has a sustained deterrent effect on financialization rather than just a short-term signaling mechanism. This study provides empirical evidence on efficiently preventing excessive financialization of enterprises, as well as some insights for mitigating systemic financial risks from the key audit matters (KAMs) disclosure perspective.