generated by the print and electronic media, and hype derived from the equity markets sentiment towards public offerings by technology firms Previous research by Willenborg and McKeown(2000)suggests the role of going-concern opinions in reducing information asymmetry, and therefore ex ante uncertainty, for IPO candidates. We extend this research on the information content of audit qualifications issued pre IPO to an Australian setting where recent amendments to the asX Listing rules have tempered e emphasis on profitability as a prerequisite to raising public equity. We also introduce a broader measure of going concern warnings' beyond an audit qualification designed to incorporate circumstances where investigating accountants may formally approve an entitys accounts while implicitly questioning the ability of that firm to operate as a going-concern We examine initial public offerings by technology companies on the AsX during 1999 and 2000. This two-year period includes a period of high growth expectations for technology stocks and a period of diminished expectations following the dramatic reduction in technology share prices that occurred in April 2000. By restricting our analysis to technology industry IPOs we examine variation within a relatively homogeneous sample of firms, but we expect cross- sectional variation in underpricing and market hype surrounding these issues across the period examined Our preliminary results indicate that the extent of underpricing is systematically related to variables measuring the hype surrounding the listing of an IPO candidate on the AsX. We find that the market sentiment as reflected in the underpricing of recent, comparable IPO candidates is systematically related to the underpricing performance of the current technology offerings Excluding a few IPOs from the sample, based upon statistical criteria, there is greater underpricing of technology IPO candidates prior to the technology market correction in April 2000. Stock hype as measured by the print and electronic media coverage of IPO candidates in the period preceding their listing on the asX is only marginally significant in explaining subsequent underpricing achieved upon listing for the full sample. The media coverage is associated with underpricing when extreme observations are excluded based upon statistical criteri There is evidence that some Australian technology firms that experienced high underpricing also had a greater rate of cash burn, consistent with the conjecture that such firms are more likely to need additional financing shortly after they go public. Finally we find that going concer warnings' issued by management or the investigating accountant for an IPO candidate are The convergent business sector'generally refers to those firms operating in the sectors of3 generated by the print and electronic media, and hype derived from the equity market’s sentiment towards public offerings by technology firms. Previous research by Willenborg and McKeown (2000) suggests the role of going-concern opinions in reducing information asymmetry, and therefore ex ante uncertainty, for IPO candidates. We extend this research on the information content of audit qualifications issued pre￾IPO to an Australian setting where recent amendments to the ASX Listing Rules have tempered the emphasis on profitability as a prerequisite to raising public equity. We also introduce a broader measure of ‘going concern warnings’ beyond an audit qualification designed to incorporate circumstances where investigating accountants may formally approve an entity’s accounts while implicitly questioning the ability of that firm to operate as a going-concern. We examine initial public offerings by technology companies on the ASX during 1999 and 2000. This two-year period includes a period of high growth expectations for technology stocks and a period of diminished expectations following the dramatic reduction in technology share prices that occurred in April 2000. By restricting our analysis to technology industry IPOs we examine variation within a relatively homogeneous sample of firms, but we expect cross￾sectional variation in underpricing and market hype surrounding these issues across the period examined. Our preliminary results indicate that the extent of underpricing is systematically related to variables measuring the hype surrounding the listing of an IPO candidate on the ASX. We find that the market sentiment as reflected in the underpricing of recent, comparable IPO candidates is systematically related to the underpricing performance of the current technology offerings. Excluding a few IPOs from the sample, based upon statistical criteria, there is greater underpricing of technology IPO candidates prior to the technology market correction in April 2000. Stock hype as measured by the print and electronic media coverage of IPO candidates in the period preceding their listing on the ASX is only marginally significant in explaining subsequent underpricing achieved upon listing for the full sample. The media coverage is associated with underpricing when extreme observations are excluded based upon statistical criteria. There is evidence that some Australian technology firms that experienced high underpricing also had a greater rate of cash burn, consistent with the conjecture that such firms are more likely to need additional financing shortly after they go public. Finally, we find that ‘going concern warnings’ issued by management or the investigating accountant for an IPO candidate are 2 The ‘convergent business sector’ generally refers to those firms operating in the sectors of