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Professor Andrew Ferguson


Andrew Ferguson is a Professor of Financial Accounting at UTS. His research has been published in leading journals both nationally and internationally including The Accounting Review, Contemporary Accounting Research, Pacific Basin Finance Journal, International Journal of Auditing, Accounting and Finance, Australian Journal of Management and Abacus. Andrew has recently received a CIFR (Centre for International Finance and Regulation) grant relating to Self Managed Superannuation Fund's.

Professor, Accounting Discipline Group
BComm, PhD
+61 2 9514 3565

Research Interests

Disclosure; Valuation; Capital Markets; Auditing; Extractive Industries

Can supervise: Yes

Supervised Student(s)

Alexey Feigin - Phd Student, Proposed Title/topic: Measuring the level of informed trading prior to a material mining stock progress report announcement.

Nelson Ma - PhD Student, Proposed Title/Topic: Auditing and the Capital Markets

Financial Accounting


Grosse, M.J. & Ferguson, A. 2014, 'Market reactions when zero-leverage firms obtain bank finance', AFAANZ Conference, Auckland, New Zealand.
Grosse, M.J. & Ferguson, A. 2014, 'Market reactions when zero-leverage firms obtain bank finance', UTS Emerging Accounting Researcher Consortium, UTS.
Ferguson, A.C., Pereira Pundrich, G. & Raftery, A.M. 2012, 'Auditor industry specialisation and market segmentation; evidence from the Perth mining cash-box market', 35th Annual Congress European Accounting Association Programme, European Accounting Association (EAA), Ljubljana, Slovenia.
Ferguson, A.C., Pereira Pundrich, G. & Raftery, A.M. 2012, 'Auditor industry specialisation and market segmentation: Evidence from the Perth mining cashbox market', AFAANZ Conference, AFAANZ, Melbourme, Australia.
Ferguson, A.C., Pereira Pundrich, G. & Raftery, A.M. 2012, 'Auditor industry specialisation and market segmentation: Evidence from Perth mining cashboxes', British Accounting and Finance Association Annual Conference 2012, British Accounting and Finance Association, Brighton, United Kingdom.
Brown, P., Feigin, A. & Ferguson, A.C. 2011, 'Daily and intraday market reactions to a star resource analyst's recommendations', AFAANZ Conference, AFAANZ, Darwin, Australia.
Brown, P., Ferguson, A.C. & Lam, P. 2011, 'Do shareholders gain from reverse takeover transactions? An analysis of the shell premium', AFAANZ Conference, AFAANZ, Darwin, Australia.
Ferguson, A.C. & Walker, A. 2011, 'Restoration and rehabilitation provisions in the Australian materials and energy sectors: Estimation and valuation implications', AFAANZ Conference, AFAANZ, Darwin, Australia.
Brown, P., Clout, V. & Ferguson, A.C. 2011, 'Market reactions to the proposed resources rent tax', AFAANZ Conference, AFAANZ, Darwin, Australia.
Brown, P.R., Ferguson, A.C. & Lam, P. 2010, 'Choice between alternative routes to go public: backdoor listing versus IPO', 2010 AFAANZ Conference Website Proceedings, Accounting and Finance Association of Australia and New Zealand Conference, AFAANZ, Christchurch, New Zealand, pp. 1-38.
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Going public is the dream of many private companies. It represents a major milestone in the development of a firm. The listing status brings a lot of advantages to a firm. Some of these advantages include (1) access to capital markets and lower cost of capital; (2) enhanced company reputation and profile; (3) providing liquidity for owners to cash out; and (4) use of stock to pay for acquisitions, among others. However, going public is also a costly process. The out-of-pocket costs for an IPO typically involve fees paid for investment banks, accountants, auditors, lawyers, other experts, underwriters and brokers. The IPO firm will also have to pay for the printing of a prospectus and listing fees and other compliance costs. Other hidden costs entail underpricing, more stringent disclosure and regulatory requirements and the time spent by senior management in preparing the company for public listing.
Brown, P.R., Ferguson, A.C. & Sherry, S. 2009, 'Tax-Loss Selling and Managerial Discretion', AFAANZ Conference Proceedings 2009 Website, Accounting and Finance Association of Australia and New Zealand Conference, AFAANZ, Adelaide, Australia, pp. 1-32.
We present evidence on the relationship between tax-loss selling (TLS), where investors with taxable gains sell stocks that have declined in value just before the fiscal year-end to generate offsetting tax losses, and managers incentives to use discretionary disclosure as a vehicle for influencing stock prices. We hypothesise that firms whose stock represents greater potential tax losses in investors portfolios at year-end will increase their disclosure level in June to prevent further share price falls due to TLS. Using the number of discretionary, market-sensitive news releases in the Signal G announcement database to measure disclosure frequency, we find that, for a large sample drawn from all ASX firms for the years 1994 to 2007, stocks with larger negative returns have higher disclosure in June. This is particularly true of small mining stocks. However, we find limited evidence that this increased disclosure contributes to the higher July returns earned by stocks that experienced significant TLS in June.
Ferguson, A.C. & Matolcsy, Z.P. 2004, 'Audit Quality and Post Earnings Announcement Drift', -, 5th Asia-Pacific Journal of Accounting & Economics Symposium, -, Kuala Lumpur, Malaysia.
Ferguson, A.C. & Matolcsy, Z.P. 2003, 'Audit quality and post earnings announcement drifts', 2003 Accounting and Finance Association of Australia and New Zealand Conference, 2003 Accounting and Finance Association of Australia and New Zealand, AFAANZ, Brisbane, pp. 1-27.
Ferguson, A.C. & Matolcsy, Z.P. 2003, 'Audit quality and post earnings announcement drifts', European Auditing Research Network 2003 Symposium, European Auditing Research Network 2003 Symposium, EARNet, Manchester, UK, pp. 1-27.
Ferguson, A.C. & Matolcsy, Z.P. 2003, 'Audit quality and post earnings announcement drifts', American Accounting Association - 2003 Annual Meeting, American Accounting Association - 2003 Annual Meeting, AAA, Honolulu, USA, pp. 1-27.
Ferguson, A.C. & Matolcsy, Z.P. 2003, 'Audit quality and post earnings announcement drift', 26th Annual Congress - European Accounting Association, Annual Congress of European Accounting Association, EAA, Seville, Spain, pp. 1-27.

Journal articles

Ferguson, A. & Scott, T. 2016, 'The determinants and market reaction to Open Briefings: an investor relations option and evidence on the effectiveness of disclosure', Accounting & Finance, vol. 56, no. 3, pp. 803-843.
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Open Briefings are market announcements styled as question and answer transcripts from a mock analyst interview and run by Orient Capital, an investor relations consultant. We found that Open Briefings are used by both growth and mature firms, and that Open Briefings are significant market events at both the daily and intraday level. In addition, the positive abnormal return does not soon reverse, suggesting Open Briefings are used by investors. We contribute to the existing literature by finding a stronger market reaction for firms with greater incentives to increase market awareness.
Feigin, A., Ferguson, A.C., Grosse, M. & Scott, T. 2016, 'Evidence on why firms use different disclosure outlets: Purchased analyst research, investor presentations and Open Briefings', Accounting Research Journal, vol. 29, no. 3, pp. 274-291.
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Ferguson, A.C., Arnold, B., Bateman, H. & Raftery, A. 2016, '(Forthcoming) Partner-scale economies, service bundling and auditor independence in the Australian self-managed superannuation (pension) fund industry', Auditing: a Journal of Practice and Theory.
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Using proprietary Australian Taxation Office (ATO) data, this study examines audit pricing, service bundling and independence issues in the self-managed superannuation fund (SMSF) sector, the fastest growing and largest segment of the Australian $2 trillion retirement savings industry. We consider the impact of partner-level scale effects for a large sample of SMSF audits for the three years to June 2010. After controlling for factors known to determine audit fees, we find evidence of fee discounting by partners with large client portfolios. However, when the dependent variable is redefined to the total 'bundle' of services (including audit and non-audit fees), the firms of partners with larger client portfolios are shown to earn bundling fee premiums. This finding suggests industry specialists price strategically using audits as a conduit to supply higher margin non-audit services (NAS) to clients with more resources. Last, we find no evidence the supply of NAS impairs auditor independence, alleviating joint supply concerns raised in the Cooper Review.
Ferguson, A.C. & Lam, P. 2016, 'Government policy uncertainty and stock prices: The case of Australia's uranium industry', Energy Economics, vol. 60, pp. 97-111.
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We investigate effects of government policy uncertainty on stock prices, reflecting tension between 'private interest' (economic benefits) and 'public interest' arguments over uranium mining. Using a sample of Australian-listed uranium firms from January 2005 through June 2008, we document a positive contemporaneous correlation between stock returns and two measures of government policy uncertainty, proxied by the spread in voters' opinion polls between the two major political parties and a news-based sentiment index. Event-study results show significant stock price reactions to key uranium-related policy events, with cross-sectional variation in event returns predicted by models incorporating firm- and project-level characteristics. Our research design and findings may inform future research on the capital market effects of government policy uncertainty in other regulated industries.
Ferguson, A. & Pündrich, G. 2015, 'Does Industry Specialist Assurance of Non-Financial Information Matter to Investors?', AUDITING: A Journal of Practice & Theory, vol. 34, no. 2, pp. 121-146.
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Ferguson, A.C. & Lam, P. 2015, 'Backdoor Listings in Australia', JASSA, no. 1, pp. 24-32.
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We study a large sample of Australian backdoor listings (BDLs) over the period from 1994 to 2014. BDLs account for roughly 13 per cent of all firms going public on the Australian Securities Exchange and are popular among hi-tech firms and those with foreign-domiciled assets. We find that the BDL market is likely influenced by the sentiment in the initial public offering (IPO) market, with the number of BDLs announced in a year being negatively (positively) correlated with the number of IPOs lodged (the percentage of IPOs withdrawn) in the prior year. Contrary to common belief, BDL transactions take longer to complete than IPOs, since they typically combine both a reverse takeover and the public listing process. Roughly three quarters of our sample raised equity capital as part of the BDL process.
Brown, P., Feigin, A. & Ferguson, A.C. 2014, 'Market reactions to the reports of a star resource analyst', Australian Journal of Management, vol. 39, no. 1, pp. 137-158.
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Ferguson, A. & Scott, T. 2014, 'What If There Were Three? Audit Pricing within the Big 4 and the PricewaterhouseCoopers' Premium in the Australian Audit Market', International Journal of Auditing, vol. 18, no. 1, pp. 57-67.
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Ferguson, A., Pündrich, G. & Raftery, A. 2014, 'Auditor Industry Specialization, Service Bundling, and Partner Effects in a Mining-Dominated City', AUDITING: A Journal of Practice & Theory, vol. 33, no. 3, pp. 153-180.
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Ferguson, A.C., Feigin, A. & Kean, S.E. 2013, 'Gold Mine Feasibility Study Disclosure In Australia: Determinants And Implications', Resources Policy, vol. 38, no. 1, pp. 8-17.
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This study investigates disclosure practices for gold development companies in their feasibility studies. The information environment around feasibility studies released by developmental stage enterprises in the Australian gold mining industry is characterised by little in the way of disclosure guidance or rules. This contrasts with Canadian disclosure requirements which are highly prescriptive. Using a sample of 85 Australian gold feasibility studies, we develop a new voluntary disclosure index and consider three problems. First, we examine the association between levels of voluntary disclosure in the feasibility study and external involvement. Second, we consider whether levels of voluntary disclosure are associated with successful debt financing. Third, we analyse the relationship between levels of voluntary disclosure and a successful project outcome. Voluntary disclosure is found to be driven by the presence of an external feasibility manager and the number of external consultants named in the feasibility release. Our evidence also finds that voluntary disclosure levels are positively related to debt financing availability and project success, suggesting voluntary disclosure levels are a useful signal of project quality.
Ferguson, A.C., Grosse, M., Kean, S.E. & Scott, T.M. 2011, 'Your Governance or Mine?', Australian Accounting Review, vol. 21, no. 4, pp. 406-417.
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In response to criticism directed at the resource sector's corporate governance, this paper examines the corporate governance and underlying firm characteristics of resource development stage entities (DSEs) relative to a size-matched sample of non-resource firms. We find that resource DSEs have different governance characteristics in the measures of board independence, chair/CEO duality and CEO cash bonuses. Furthermore, there are differences in the information environment measures of analyst following, debt levels, stock market return and stock turnover. Considering we document substantial differences in underlying firm characteristics, corporate governance differences are likely appropriate to the mining industry and should not be uniformly labelled as 'bad~ Our results suggest that media rankings based on corporate governance scores may not accurately portray the resource sector. Overall, our results are of interest to Australian investors and regulators and contribute to a broader understanding of contextually contingent corporate governance.
Ferguson, A.C. & Scott, T.M. 2011, 'Market reactions to Australian boutique resource investor presentations', Resources Policy, vol. 36, pp. 330-338.
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This paper examines the market reactions to 817 investor presentations by 326 Australian resource firms and finds evidence suggesting these events are informative. Furthermore, the positive returns do not reverse over the following 15 days, which contrasts with previous investor presentation research. However, consistent with the prior literature, extended long run cumulative abnormal returns are not significantly different from zero. This paper also documents stronger reactions to first time presenting firms, presentations that are announced to the market and firms exhibiting at the Africa Downunder and Excellence in Oil & Gas conferences. There are also stronger reactions for firms with lower ownership concentration. Examining boutique resource firm investor presentations adds to the existing disclosure and dissemination literature due to the presence of relatively high information asymmetry in the extractive industries, a unique setting, which contrasts with previous studies.
Ferguson, A.C., Clinch, G.J. & Kean, S.E. 2011, 'Predicting the Failure of Developmental Gold Mining Projects', Australian Accounting Review, vol. 21, no. 1, pp. 44-53.
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This paper investigates firm-level financial and non-financial information and their association with project failure for a sample of pre-production gold development firms. Pre-revenue generating `single project mining companies are chosen, since project failure is synonymous with company failure for these firms. The setting is interesting due to the high information asymmetry and limitations of the GAAP-based Altman Z-score in this context. A definition of project failure is applied and both financial and non-financial predictors are compared. Failure is driven by whether the deposit is open pit or underground, and whether the cash cost of production is disclosed at feasibility completion.
Brown, P.R., Ferguson, A.C. & Sherry, S. 2010, 'Investor Behaviour In Response To Australia's Capital Gains Tax', Accounting And Finance, vol. 50, no. 4, pp. 783-808.
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We calibrate the effect of Australia's Capital Gains Tax (CGT) on share prices and market activity. Based on a large sample drawn from all listed Australian companies for the years 1994-2007, we find significant tax-loss selling (TLS) of shares that lost
Brown, P.R., Ferguson, A.C. & Jackson, A.B. 2009, 'Pierpont and the capital market', Abacus, vol. 45, no. 2, pp. 147-170.
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For almost forty years Trevor Sykes was one of the most recognizable business journalists in Australia. Sykes created his Pierpont character in February 1972 while writing for Australia's leading financial paper, the Australian Financial Review. Pierpont was a take on J. Pierpont Morgan, founder of the J. P. Morgan banking house. Sykes used his Pierpont column to research and reflect on the curious world of Australian business. Articles were mostly in narrative form, comprising an in-depth critique of one or more companies and written with more than a touch of humour. Over the years Pierpont garnered a large following, and it is therefore quite possible his musings influenced investors' beliefs about company fundamentals. We assess this possibility by examining the share price movements of companies around the time they found themselves featured in a Pierpont column. We extend previous work in this area by examining the market reaction to a popular columnist's writings published regularly over a lengthy period, and by implementing an extensive double-coding procedure that allows us to more finely and reliably partition trading recommendations based on the content of each column. In brief, we find evidence that stocks with positive coverage by Pierpont enjoyed abnormal returns averaging 6.4 per cent over thirty days around the publication date, while stocks with negative coverage suffered abnormal losses of 5.5 per cent. Trading volume was also affected.
Brown, P.R., Ferguson, A.C. & Stone, K. 2008, 'Share purchase plans in Australia: Issuer characteristics and valuation implications', Australian Journal of Management, vol. 33, no. 2, pp. 307-322.
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Share purchase plans (SPPs) are offered exclusively to a company's registered shareholders, who may purchase up to $5,000 worth of shares in a 12-month period at a discount to the market price and without any brokerage charge. They have become one of the most frequently used mechanisms for raising publicly traded equity capital in Australia, yet little is known about them from a financial markets perspective. We address this deficiency by documenting the characteristics of Australian firms that have adopted SPPs and assessing their short-term and long-term valuation implications. We find that SPPs are more likely to be issued by firms with lower levels of liquidity and relatively large numbers of shareholders. They have a negative announcement effect, which is associated with the size of the issue, the prior share-price runup, the issue-price discount, the firm's industry, and whether there is enough time for non-shareholders to buy shares in order to participate. Long-run underperformance is also found over extended periods, consistent with much of the seasoned equity offering (SEO) literature. The SPP-issuer did not perform as badly if it was in the mining industry, if it was audited by a 'Big-N' firm, or if the issue was underwritten. Conversely, the greater the issue discount, the worse the issuer's long-run performance
Ferguson, A.C., Francis, J.R. & Stokes, D. 2006, 'What matters in audit pricing: industry specialization or overall market leadership?', Accounting and Finance, vol. 46, no. 1, pp. 97-106.
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Ferguson et al. (2003) report that audit industry fee premia primarily reside with joint national and city-specific industry leadership as opposed to merely firm-wide (national) industry expertise, suggesting auditor choice among the Big 5 is best conceptualized on joint industry specialization in city-specific markets and nationally. The present study examines whether the prior results could be confounded by the presence of city-specific overall market leadership effects. Our findings reaffirm that joint local and national auditor industry expertise is valued by audit clients. Furthermore, overall city-specific leadership, by itself, also matters in fee determination and results in higher fees, although at a slightly weaker level of statistical significance
Carson, E., Ferguson, A.C. & Simnett, R. 2006, 'Australian audit reports: 1996-2003', Australian Accounting Review, vol. 16, no. 3, pp. 89-96.
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Since the amendment of the audit reporting standard in 1996, the rate of qualifications for publicly listed companies has fallen to around 4%, much less than the pre-amendment qualification rate of around 15%-20%. This shows that the changes to the audit reporting standards have had a significant and the desired effect of improving the disclosure in the financial statements, with which the auditor must concur, rather than resulting in an audit qualification. This desired effect is to draw the emphasis away from issuing qualifications and to encourage an increased level of disclosure in the financial reports for issues of significance. Auditors who are satisfied with the level of disclosure can issue an unqualified report, and if they wish, bring the user's attention to these issues by emphasizing the matter in the audit report. The frequency with which different types of opinions are issued is examined and the types of opinions are compared.
Brown, P.R., Ferguson, A.C. & Stone, K. 2006, 'Share purchase plans', JASSA, vol. 1, no. Autumn, pp. 18-23.
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By mid-2005, share purchase plans (SPPs) had been used 600 times by 400 listed Australian companies since PPs were introduced in 1991. This form of seasoned equity offering (SEO), is available only to registered shareholders, with the shares being offered at a discount to the market price and without any brokerage charge.
Ferguson, A.C. 2005, 'A review of Australian audit pricing literature', Accounting Research Journal, vol. 18, no. 2, pp. 54-62.
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Ferguson, A.C. & Matolcsy, Z.P. 2004, 'Audit quality and post earnings announcement drift', Asia-Pacific Journal of Accounting and Economics, vol. 11, no. 2, pp. 121-137.
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This study examines the value of audit quality in the capital markets setting. We argue that higher quality auditors are associated with lower post-earnings announcement drift (PEAD). Results show that clients of brand name auditors exhibit lower PEAD than small auditors, but only weak auditor industry specialist effects are identified. PEAD also differs for clients of individual Big 6/5 auditors, with clients of the smaller Arthur Andersen and Deloittes exhibiting greater PEAD, consistent with the DeAngelo (1981) size hypothesis. Finally, PWC exhibits higher PEAD in 1998, suggesting market uncertainty about quality implications of audit market structural change.
Ferguson, A.C., Francis, J.R. & Stokes, D. 2003, 'The effects of firm-wide and office-level industry expertise on audit pricing', The Accounting Review, vol. 78, no. 2, pp. 429-448.
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This study examines the role of auditor industry expertise in the pricing of Big 5 audits in Australia. We test if the audit market prices an auditor's firm-wide industry expertise, or alternatively if the audit market only prices office-level expertise in those specific cities where the auditor is the industry leader. We document that there is an average premium of 24 percent associated with industry expertise when the auditor is both the city-specific industry leader and one of the top two firms nationally in the industry. However, the top two firms nationally do not earn a premium in cities where they are not city leaders. We further document that national leadership rankings are, in fact, driven by the specific offices where accounting firms are city leaders. Thus, the overall evidence supports that the market perception and pricing of industry expertise in Australia is primarily based on office-level industry leadership in city-specific audit markets
Ferguson, A.C. & Crockett, A. 2003, 'Information transfer and press coverage: The case of the Gawler Craton gold boom', Pacific-Basin Finance Journal, vol. 11, no. 1, pp. 101-120.
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This study examines intra-industry information transfer after Helix Resources announced a successful drill result in the Gawler Craton region of South Australia that sparked significant investor interest in mining companies with tenement holdings in the area. This study shows that the price response of competing explorers was determined by press coverage immediately following the discovery of gold, but stocks that received the most press attention in the immediate post-announcement period suffered the greatest long-term underperformance. The research is the first in capital market literature to make use of geographical information systems software technology.
Ferguson, A.C. & Stokes, D. 2002, 'Brand name audit pricing, industry specialization, and leadership premiums post-big 8 and big 6 mergers', Contemporary Accounting Research, vol. 19, no. 1, pp. 77-110.
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Matolcsy, Z.P. & Ferguson, A.C. 2003, 'Audit quality and post earnings announcement drift (Acct paper #59)'.


Haas, M.R., Chapman, S., Viney, R.C., Hall, J.P. & Ferguson, A.C. CHERE 1999, The news on health economics: a study of resource allocation in health in the Australian print media for 1996, CHERE Discussion Paper No 40, Sydney.