The Role of Assurance in Equity Crowdfunding

Evisa Bogdani, Monika Causholli, W. Robert Knechel

Research output: Contribution to journalArticlepeer-review

6 Scopus citations


The SEC requires equity crowdfunding (ECF) companies to provide assured financial statements. Assurance can be provided with certification by management or an audit or review by an independent accountant. We utilize the ECF setting to examine whether voluntary assurance facilitates capital formation. We find that companies that provide either reviewed or audited financial statements during a capital campaign are marginally more likely to raise their target capital. They also raise more funds and attract more investors relative to companies that only provide management-certified financial statements. However, relative to reviews, audits are not associated with a greater likelihood of success in an ECF offering other than attracting more investors. Finally, we find that assurance is indirectly associated with a company's post-ECF survival and its ability to raise future capital. This suggests that assurance at the time of ECF has implications for a company's success beyond ECF.

Original languageEnglish
Pages (from-to)51-76
Number of pages26
JournalAccounting Review
Issue number1
StatePublished - 2022

Bibliographical note

Publisher Copyright:
© 2022 American Accounting Association. All rights reserved.


  • assurance
  • audit, reviews
  • capital financing
  • equity crowdfunding
  • startups

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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