Assuring the Crowd: The Role of Assurance in Securities Crowdfunding Success

• 成果类型: Article; Early Access
• 署名作者: Burke, Qing; Wangerin, Daniel; Warfield, Terry
• 署名单位: University System of Ohio; Miami University; University of Wisconsin System; University of Wisconsin Madison
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2022.03178
• 发表日期: 2025
• 关键词: financial statement assurance; regulatory noncompliance; SEC Regulation Crowdfunding; securities crowdfunding offerings

摘要

This paper examines the role of CPA financial statement assurance in securities crowdfunding. Under SEC Regulation Crowdfunding, effective May 2016, early-stage private companies are permitted to conduct securities crowdfunding offerings-low-dollar securities offerings on Internet platforms-to a large number of investors. Using SEC filings and hand-collected data on the universe of offerings from 2016 to 2019, we examine the relation between CPA assurance and capital raised in the securities crowdfunding market. We fail to find evidence that issuers voluntarily seek higher levels of assurance, and we document high rates of noncompliance with the CPA assurance requirements. Our results suggest the on average positive association between CPA assurance and crowdfunding outcomes shown in prior research is explained by noncompliance with the Reg CF assurance requirements and is not driven by additional assurance. Overall, this study provides new insights of interest to crowdfunding issuers, investors, and regulators on the role of assurance in this nascent market of capital formation for startups.