Disclosure of Key Audit Matters and Total Factor Productivity of Listed Companies

The improvement of total factor productivity is an important starting point for achieving high-quality economic development. Based on the data of China's A-share listed companies from 2015 to 2023, this paper empirically examines the effect and mechanism of key audit matters disclosure on total factor productivity, and tests the moderating effect caused by the auditors' industry expertise. The results indicate that the more comprehensively key audit matters are disclosed, the higher the firm's total factor productivity will be; the auditors' industry expertise can positively regulate the relationship between them. The mechanism test shows that the disclosure of key audit matters improves total factor productivity by promoting R&D investment to gain technology accumulation, enhancing stock liquidity to alleviate financing constraints, optimizing human capital structure to resolve productivity paradox, and improving innovation quality to promote technology application. Further research suggests that negative tone, conclusive evaluation, unconventional and high-precised key audit matters can play a more important role in promoting the improvement of total factor productivity. This study is helpful to improve the audit quality of enterprises, advance the total factor productivity of enterprises, and promote the corporate high-quality development.