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Succession of Family Firms and Accounting Conservatism  [PDF]
Ying Chen
Modern Economy (ME) , 2019, DOI: 10.4236/me.2019.101020

Using data of listed family firms and based on the multivariable regression model, this paper studies the changes in the quality of accounting information of family firms during the succession period as well as the regulating effect of successor’ characteristic variables—educational level on the relation between succession and accounting conservatism. The results show: The succession of family firms will improve the level of accounting conservatism, suggesting that after the succession, the leader’s personal authority and social capital declined, and the information disclosure level of the firm tends to be conservative; besides, the successors’ personal qualities, particularly the educational and professional background will have a significant impact on the accounting conservatism after taking over the corporate. It can be seen that as a special stage, the succession will affect the accounting information disclosure policy of family firms, and it shows strong heterogeneity with the succession.

Board Gender Diversity, Earnings Quality and Stock Price Informativeness  [PDF]
Yue Gao
American Journal of Industrial and Business Management (AJIBM) , 2018, DOI: 10.4236/ajibm.2018.82018
Abstract: Further recognition of women’s social value and the gradual improvement of women’s economic status have made the proportion of female independent directors on board rise year by year, which has received high attention from academia. Using data of A-share listed companies in Shanghai and Shenzhen stock markets form 2000-2014 in China, this paper investigates the relation among gender diversity, earnings quality and stock price informativeness. As a result, the larger the proportion of female independent directors is, the more firm-specific information the stock price contains. In the meantime, earnings quality of listed companies significantly impact on stock price informativeness, which means that stock prices of companies with higher earnings quality contain more firm-specific information while having other factors controlled. Further studies show that the relation between board gender diversity and stock price informativeness is not simply direct; board gender diversity could raise the stock price informativeness through enhancing earnings quality.
Earnings Quality, Earnings Management, and Cross-listings: Evidence from French Firms
Trabelsi Slaheddine
Management and Economics Research Journal , DOI: 10.18639/MERJ.2015.01.156495
Abstract: This paper examines the earnings quality of French firms cross-listed in the United States, United Kingdom and non-cross-listed french firms. We examine quality of financial reporting based on measures of earnings management, Timely Loss Recognition (TLR) and price-earnings association. We find that both cross-listings and non-cross-listings show significant earnings smoothing activities and tend to use accruals to manage earnings, and are not Timely in Loss Recognition. We surmise that cross-listing in the United States or United Kingdom has not changed the accounting choices of French cross-listing firms relative to firms that are not cross-listed. However, our findings show that the market considers earnings and book value data of cross-listing firms to be more informative than those of non-cross-listing firms.
Earnings Benchmarks in International hotel firms  [cached]
Laura Parte Esteban,María Jesús Such Devesa
Cuadernos de Gestión , 2011,
Abstract: This paper focuses on earnings management around earnings benchmarks (avoiding losses and earnings decreases hypothesis) in international firms and non international firms belonging to the Spanish hotel industry. First, frequency histograms are used to determine the existence of a discontinuity in earnings in both segments. Second, the use of discretionary accruals as a tool to meet earnings benchmarks is analysed in international and non international firms. Empirical evidence shows that international and non international firms meet earnings benchmarks. It is also noted different behaviour between international and non international firms.
Pre Managed Earnings Benchmarks and Earnings Management of Australian Firms
Lan Sun,Subhrendu Rath
Australasian Accounting Business and Finance Journal , 2012,
Abstract: This study investigates benchmark beating behaviour and circumstances under which managers inflate earnings to beat earnings benchmarks. We show that two benchmarks, positive earnings and positive earnings change, are associated with earnings manipulation. Using a sample ofAustralian firms from 2000 to 2006, we find that when the underlying earnings are negative or below prior year’s earnings, firms are more likely to use discretionary accruals to inflate earnings to beat benchmarks.
Finance Perspective versus Accounting Perspective: The Case of Earnings Persistence in Indonesia
International Journal of Economics and Finance , 2012, DOI: 10.5539/ijef.v4n9p191
Abstract: This study aims at comparing accounting and finance perspective to predict earnings persistence. Accounting perspective predicts that current earning components affect the future earnings, while finance perspective predicts that current dividends affect the future earnings. The results show that component of earnings more persistence rather than total earning, and persistence of earnings are also showed by changes of dividend. The results of this study that changes in dividend policy have information contents about future earnings. Increase in dividend payment show that firm believe that firm have better prospect in the future thus able to achieve better future performance. This result confirm prospect theory. This research also find manager use dividend policy to convey relevant information to investor. Managers believe that firms have good opportunity in the future and achieve higher performance. In this case, managers pays higher dividend to give signal to investor that firm will achieve better performance. Firms using dividend policy to give signal to investor to convey relevant information. This result confirm dividend signalling theory. The results also confirm agency theory studying the relationship between management (agent) and shareholder (principal) and assuming the more unite the shareholder, the more powerful shareholders’ position rather management’s position. The principal interested to both earnings distribution and increasing in future earnings, whereas management prefer increasing permanent earnings with increasing investment on prospective project rather than dividing dividend. The findings of the study show that increase in current earnings and dividend indicates increase in future earnings and dividends. The results of the study show that accrual-cash flow perspective better indicating quality of earnings than dividend signaling perspective.
Family Control and Earnings Quality  [PDF]
Carolina Bona Sánchez,Jerónimo Pérez Alemán,Domingo Javier Santana Martín
Revista de Contabilidad : Spanish Accounting Review , 2007,
Abstract: El trabajo analiza la relación entre el control familiar y la calidad de la información contable en un contexto en el que el tradicional conflicto de agencia entre directivos y accionistas se desplaza a la divergencia de intereses entre accionistas controladores y minoritarios. Los resultados alcanzados muestran que, en comparación con las no familiares, las empresas de naturaleza familiar divulgan unos resultados de mayor calidad, tanto en términos de menores ajustes por devengo discrecionales como de mayor capacidad de los componentes actuales del resultado para predecir los cash flows futuros. Además, el aumento en los derechos de voto en manos de la familia controladora incrementa la calidad de los resultados contables. La evidencia obtenida se muestra consistente con la presencia de un efecto reputación/vinculación a largo plazo asociado a la empresa familiar. Adicionalmente, el trabajo refleja que a medida que disminuye la divergencia entre los derechos de voto y de cash flow en manos de la familia controladora, aumenta la calidad de la información contable.PALABRAS CLAVE: derechos de voto, divergencia, empresa familiar, calidad delresultado, reputación, beneficios privados.This work examines the relationship between family control and earnings quality in a context where the salient agency problem shifts away from the classical divergence between managers and shareholders to conflicts between the controlling owner and minority shareholders. The results reveal that, compared to non-family firms, family firms reveal higher earnings quality in terms of both lower discretionary accruals and greater predictability of future cash flows. They also show a positive relationship between the level of voting rights held by the controlling family and earnings quality. The evidence is consistent with the presence of a reputation/long-term involvement effect associated with the family firm. Moreover, the work reflects that, as the divergence between the voting and cash flow rights in the hands of the controlling family decreases, earnings quality increases.
Investigation on Information Content of Conservative and Non-Conservative Accounting Earnings
International Journal of Finance and Accounting , 2012, DOI: 10.5923/j.ijfa.20120104.01
Abstract: The present research examines the relationship between conservatism in financial reporting and information content of accounting earnings. In this study, conservatism and information content is measured by Basu (1997) Easton and Harris (1991) models, respectively. This study is applied research and its method is ex post facto (casual-comparative). Statistic population is firms listed in Tehran Stock Exchange (TSE). By using the firm-year method during the period of 1380 to 1387, 764 observations from 145 firms listed in TSE have been selected. The multiple regression test has been used to test research hypothesis. The results show a non-linear relationship between information content of accounting earnings and conservatism. In addition, the results suggest a non-linear relationship between conservatism and cost of capital.
Equities Incentive, Informativeness of Stock Price and Earnings Management: Based on the Chinese A-Share Listed Companies  [PDF]
Qifan Zhong
Modern Economy (ME) , 2016, DOI: 10.4236/me.2016.73028
Abstract: Equities incentive is more and more frequently used for motivating management among Chinese listed companies, but whether it will degrade informativeness of stock price, thus reduce the efficiency of capital allocation in security market remains to be verified. This article used the data of A-share listed companies in China from 2010-2014, deployed an empirical research to study the relationship between equities incentive and informativeness of stock price, considering earnings management as an intermediary variable. According to the analysis results, we found that higher level of equities incentive tended to degrade the level of informativeness of stock price, and the earnings management was not an effective intermediary variable, which meant the earnings management resulted from equities incentive was less likely to affect informativeness of stock price.
Accounting Information, the Cost of Capital and Excess Stock Returns: The Role of Earnings Quality-Evidence from Panel Data  [cached]
Nicholas Apergis,George Artikis,Sofia Eleftheriou,John Sorros
International Business Research , 2012, DOI: 10.5539/ibr.v5n2p123
Abstract: This paper investigates the impact of the firm’s accounting information and, especially the role of earnings quality, on its cost of capital and how this influences excess returns. The analysis extends prior works by investigating how components of accounting information and, especially earnings quality, affect stock returns through their effect on the cost of capital. The empirical approach uses a sample of US manufacturing firms as well as the methodology of panel data. The empirical findings display that all components of accounting information affect the firm’s cost of capital, which, in turn, exerts a negative effect on the firm’s excess returns, an empirical documentation not captured in case that the analysis links directly the cost of capital and excess returns.
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