Using Chinese data of key audit matters (KAM) reports, this study assesses whether the KAM rule improves audit quality and how KAM disclosures relate to audit quality. With textual analysis, we evaluate disclosure characteristics in detail and find that auditors report both industry-generic and firm-specific KAM. The wordings, to a large extent, are firm-specific and differ in KAM reporting components. Our empirical investigation via the pre-post and difference-in-differences analyses reveals that audit quality is improved following the mandatory rule. The cross-sectional analysis shows that the number of KAMs and disclosure characteristics (such as specificity, similarity, readability, and length) signal auditors' concern about clients' earnings quality, audit effort, and the propensity of issuing modified opinions. Overall, our paper provides some evidence on the implementation and communicative value of the new KAM reporting.

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Background Recently, circular RNAs (circRNAs) have been reported to be microRNA sponges and play essential roles in cancer development. This study aimed to evaluate whether circulating circRNAs could be used as diagnostic biomarkers for lung adenocarcinoma (LUAD). Methods The Gene Expression Omnibus (GEO) dataset was used to investigate differentially expressed circRNAs (DEcircRNAs) in paired LUAD tissues and adjacent nontumor tissues. The expression levels of the host genes were analyzed in The Cancer Genome Atlas (TCGA)-LUAD dataset, and the prognostic value was assessed using the Kaplan–Meier plotter. Quantitative real-time PCR (qRT-PCR) was performed to validate the expression of candidate circRNAs in the LUAD plasma and cells. The CCK8 assay was used to measure the function of circRNAs in cell proliferation. Competing endogenous RNA (ceRNA) network, gene ontology (GO) and Kyoto Encyclopedia of Genes and Genomes (KEGG) pathway analyses were performed to predict the possible mechanisms and functions of circRNAs in LUAD. Results Two upregulated and two downregulated circRNAs were identified as candidate circRNAs using bioinformatics analysis. qRT-PCR demonstrated that hsa_circ_0005962 was upregulated in LUAD plasma and cells, whereas hsa_circ_0086414 was downregulated. Receiver operating characteristic (ROC) curve analysis confirmed that a signature comprising the two circRNAs had good diagnostic potential, with an area under the ROC curve (AUC) of 0.81 ( P < 0.0001). In addition, we observed that overexpression of plasma hsa_circ_0086414 was related to EGFR mutations ( P = 0.001). Plasma hsa_circ_0005962 displayed significantly different expression before and after surgery in patients with LUAD ( P < 0.0001). In vitro experiments suggested that hsa_circ_0005962 promoted LUAD cell proliferation. For future studies, we predicted the circRNA-miRNA-mRNA network for hsa_circ_0005962. Bioinformatics analysis revealed that hsa_circ_0005962 might be involved in LUAD development. Conclusion A circRNA signature was identified as a potential noninvasive biomarker for LUAD diagnosis. Electronic supplementary material The online version of this article (10.1186/s12967-019-1800-z) contains supplementary material, which is available to authorized users.

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