Muttanachai SUTTIPUN, Trairong SWATDIKUN / Journal of Asian Finance, Economics and Business Vol 8 No 4 (2021) 0841–0848 841 841 Print ISSN: 2288-4637 / Online ISSN 2288-4645 doi:10.13106/jafeb.2021.vol8.no4.0841 KAMs Reporting and Financial Performance: Empirical Evidence from Thai Listed Companies Muttanachai SUTTIPUN 1 , Trairong SWATDIKUN 2 Received: December 20, 2020 Revised: March 07, 2021 Accepted: March 15, 2021 Abstract This study seeks to investigate Key Audit Matters (KAMs) reporting of Thai listed companies in Thailand, and examines the influence of KAMs reporting on corporate financial performance. Data were collected from 180 companies listed in Thailand during 2016 to 2018, which accounted to 540 annual reports. KAMs reporting was quantified by content analysis from the audit reports, while financial performance and corporate characteristics were collected from the corporate annual reports. Descriptive analysis and multiple regressions were performed to analyze the data. The study results reveal that there was an increasing of KAMs reporting in audit report of listed companies in Thailand in terms of both number of issues and number of words across the observed period. The regression analysis indicates that was a significant and negative influence of words counted as KAMs reporting on financial performance, while there was no influence of KAMs reporting issue on the performance. Moreover, there was a negative relationship between corporate complexity and financial performance, while audit type had a positive correlation with financial performance. This study shows significant contribution on the implication of KAMs in an emerging economy and the role of KAMs as a communication device between auditor and stakeholders. Keywords: Key Audit Matters, Financial Reporting, Agency Theory, Emerging Market, Thailand JEL Classification Code: M42, L25, O16 providing new audit report should be considered a big step forward in financial reporting phenomenon. As traditional form of audit report involves standardization, KAMs was introduced in the hope to help financial statement user to better compare the auditors’ message across the firms and industries (Tangruenrat, 2015; Tangruenrat, 2017). However, homogeneity in audit report has got criticized for lacking specific information on justification of assessment of a given specific audited firm (Datejarutsri, Sampet, & Kosaiyakanont, 2019; Backof, Bowlin, & Goodson, 2018; Bentley, Lambert, & Wang, 2018. Sirois, Bedard, and Bera (2017) mentioned that Key Audit Matters (KAMs) was introduced as a new audit standard to provides specific information on auditor’s determination in areas of higher assessed risk of material misstatement, significant risks, and significant auditor’s judgments relating to areas in the financial statement. Datejarutsri et al. (2019) added that is an effect of the audit of significant events or transactions that occurred during the period of the financial statement, made mandatory after December 31, 2017. The new audit standard provides opportunities for stakeholders to engage with new set of useful information provided by the auditor 1 First Author. Assistant Professor of Accounting, Faculty of Management Sciences, Prince of Songkla University, Thailand. Email: muttanachai.s@psu.ac.th 2 Corresponding Author. School of Management, Walailak University, Thailand [Postal Address: Nakhon Si Thammarat 80160, Thailand] Email: trairong.sw@wu.ac.th © Copyright: The Author(s) This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons.org/licenses/by-nc/4.0/) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited. 1. Introduction Financial reporting, among multiple factors cause, financial instability and is subjected to continual criticism over limitation on relevant information for decision- making. Financial reporting standards have been updated systematically. However, bridging expectation gap among auditors and stakeholders over information asymmetry on auditor’s decision-making is now a center of attention. Furthermore, regulators facilitate transparency in support of the revolution in auditor communication in public interests. The alignment between the stakeholders and auditors in