Corporate Governance Impacts Earnings Management

Ria
Bibliography Details (title. author.

year. volume no etc. url. date
retrieved)
Corporate Governance and

Accruals Earnings
Management.Doukakis, L. &
Bekiris, F. October 2011.
Managerial and Decision
Economics, Volume 32, Issue 7,
Pages 439-456 .
http://papers.ssrn.com/sol3/papers.
cfm?abstract_id=1888403. Feb 28
may be a mother article
Summary of Abstract/ Contribution

Data Needed (distinguish the
to the Topic
dependent & independent variables) Methodology/Statistical Technique
examined the association between

corporate governance and accruals
earnings management using a
Corporate Governance Index (CGI)
consisting of 55 individual corporate
governance measures
(comprehensive)
Corp Governance
benchmarked corporate
governance of listed firms to
international best practices using
info found in annual reports and
company websitesused corporate
governance index of 55 individual
measures in 5 dimensions, namely
index from Risk Metrics former ISS Board of Directors, Audit,
Remuneration, Shareholder Rights
Proxy, GMI Ratings, Standard &
and Transparency
Poors
Disclosure and Transparency Index All the variables are binary and 1
point is awarded for the presence of
the specific variables in each firm
information found in fs and
and 0 otherwise. Finally, if the firm
websites
does not provide information for a
variable, we document it as a
missing observation
equal weighting for the
variablesEarnings Management
used absolute abnormal
accrualsemployed Jones, modifiedJones, Larcker and Richardson,
Dechow models
Findings
inverse relationship since corp

governance seems to constrain
tendency of management to
manage earnings for the sake of
increased credibilityinverse
relationship do not apply for small
capitalization firmscorp governance
limits upwards but not downwards
earnings management
Ria

retrieved)

to the Topic
Corp governance indices

use exploratory principal
component analysis (PCA) to
identify the underlying dimensions
or structure of corporate
governance and determine which
indicators are associated with each
factor. We retain all factors with an
eigenvalue greater than unity
results in 14 factors that retain 61.7
percent of the total variance in the
original data. This reduced solution
is then rotated using an oblique
rotation that allows the retained
Corporate Governance, Accounting
factors to be correlated in order to
Outcomes, and Organizational
examined association between corp
enhance interpretability of the PCA
Performance. Larcker, D. &
governance, accounting and
solution associate each factor with
independent variables: control and those variables that have a loading
Richardson, S. & Tuna, A. Oct
economic outcomes, and then
governance factors
2007. Accounting Review.
developed a corp governance index
(or the correlation between the
http://papers.ssrn.com/sol3/papers. based on these associations
factor and an indicator) that
exceeds 0.40 in absolute value and
are statistically different from zero
at conventional levels. Statistical
significance is determined using
traditional bootstrapping methods
(1,000 samples with replacement)
for the rotated 14 factor solution
reliability (or the inverse of
estimated measurement error) of
the indices is computed using the
Cronbach alpha for indicators
associated with each governance
constructemployed Pearson (rp)
and Spearman (rs) bivariate
correlations
The Effects of Corporate

Ownership Structure and Board
Size on Earnings Management:
Evidence from Turkey. Aygun, M. & investigates the impact of corporate
Ic, S. & Sayim, M. Nov. 2014.
ownership structure and board size
International Journal of Business
on earnings management
and Management; Vol. 9, No. 12.
http://dx.doi.org/10.5539/ijbm.v9n12
p123. Feb 28
dependent variable: earnings

managementindependent variables:
managerial ownership, institutional
ownership and board size2
variables measuring corporate
ownership structure: managerial
ownership and institutional
ownershipthree controlled
variables: return on assets, size of
the firm and financial leverage
adjusted Jones Model to estimate

discretionary accruals and the
multivariate regression technique
are utilized
Findings
suggests that there are 14

dimensions to corporate
governancecorp governance
indices have a mixed association
with abnormal accruals, little
relation to accounting restatements,
but some ability to explain future
operating performance and future
excess stock returns
have negative significant effect on

the earnings management:
institutional ownership, board size
and financial leverage positively
statistically significant effect on
earnings management: managerial
ownership on earnings
management and return on assets
Ria

retrieved)

to the Topic
independent variable: firm
performance measured by
operating performance, market
valuation or stock returnsdependent
variables: firm governance
measured by index of several
employed a simple model found in
aspects combined into one
measure; and controls and an error page
termdata d include firm financial
statements (balance sheet and
income statements) and market
information (stock price, stock
returns and market capitalization)

Performance around the World:
What We Know and What We
Dont. Love, I. n.d. Development
Research Group. The World Bank.
http://wwwwds.worldbank.org/external/default/
WDSContentServer/WDSP/IB/2012
/06/14/000425962_2012061411064
1/Rendered/PDF/696940ESW0P10
40vey0WBRO0revised0806.pdf.
Feb 28
surveys a vast body of literature

devoted to evaluating the
relationship between corporate
governance and performance as
measured by valuation, operating
performance or stock returns
CORPORATE GOVERNANCE
AND ACCOUNTING STANDARDS
IN INDIA: AN EMPIRICAL STUDY
ON PRACTICES. Shankaraia, K. &
Rao, D. n.d.
http://unpan1.un.org/intradoc/group
s/public/documents/apcity/unpan02
3821.pdf. Feb 28
examine the accounting standards

and their practices in India, with a
view to strengthen the accounting
standards and improve their
practices for good Corporate
data obtained from annual reports
Governance corporates
perceptions on the relevance of
accounting standards for good
Corporate Governance in Indian
context are also examined
Corporate Governance and Firm

Performance: Evidence from
Karachi Stock Exchange. Khatab,
H. Masood, M. Zaman, K. Saleem, seeks to investigate the relationship
S. Saeed, B. February 2011.
between corporate governance and data from annual reports
International Journal of Trade,
firms performance
Economics and Finance, Vol.2,
No.1. http://ijtef.org/papers/76F499.pdf. Feb 28
Globalization. n.d. OSullivan.
showed the history of corporate
http://www.insead.edu/facultyresear governance and how globalization
ch/research/doc.cfm?did=1095.
affected
Feb 28
Findings
corporate governance is likely to

develop endogenously and depend
on specific characteristics of the
firm and its environment.
suggestions include:
wide acceptance of accounting
standards in practiceuse of uniform
accounting standards would
enhance the qualitative and
comparability dimensions of
used the simple percentage method financial statement and
reportingestablishment of harmony
among the applicable laws which
have significant bearing on different
items of financial statements, would
give true and fair view of business
corporate governance is analyzed
through Tobins Q, while
performance of the firms is
measured by return on assets
(ROA) and return on equity
(ROE)multiple regression models
are applied to test the significance
of corporate governance and firm
profitability
firms with having good corporate

governance measures perform well
as compared to the firms having no
or less corporate governance
practices.
Ria

retrieved)
Corporate Governance Ratings and
Firm Performance. Ertugrul, M. &
Hegde, S. 2009. Financial
Management, Vol. 38, No. 1, pp.
139-60.
Does Weak Governance Cause

Weak Stock Returns? An
Examination of Firm Operating
Performance and Investors
Expectations.Core, J. & Guay, W. &
Rusticus, T. April 2006.Journal of
Finance vol. 61, no. 2 .
http://www.cfapubs.org/doi/pdf/10.2
469/dig.v36.n3.4212?src=recsys.
Feb 28

to the Topic
examine the corporate governance
ratings provided by three premier
US rating agencies find that
summary scores are generally poor observation on TCL, GMI and ISS
ratings obtained from Bloomberg
predictors of primary and
secondary measures of future firm
performance.
authors argue that investors should

not be surprised by worse operating
performance of poor governance
companies and lower takeover
probabilities for companies with
poor shareholder rights
consists of all firms that have a Gindex, and is the sample from GIM.
GIM construct the G-index based
on the Investor Responsibility
Research Center (IRRC) surveys of
investor rights and takeover
protection
Findings
pairwise correlation
regress measures of future
operating performance
firms with high

TCL overall ratings have lower
future operating performance. Our
results also indicate that the ISS
summary ratings are negatively
correlated with future operating
performance, but the GMI overall
ratings
are positively correlated
used GIM index for shareholder

rights or G-INDEXused return on
equity to measure
performancepearson
correlationdescriptive statistics
authors find that stock analysts

sufficiently anticipate the poor
operating performance of weak
governance companies, which
demonstrates that governance
alone does not cause the market
performancecompanies with weak
shareholder rights were taken over
with greater frequency. They claim
the increasing takeover rate
disproves a takeover penalty being
applied to the weak governance
companies. indicate that weak
corporate governance does not
necessarily result in poor stock
returns. They suggest that it is likely
that time-specific returns or
differences in expected returns
played a role in the observed
abnormal returns for companies
with strong governance.
Ria

retrieved)

to the Topic
The Determinants of Corporate

Governance and the Link between
Performance: Evidence from the
U.K. Using a Corporate
may help in creating a scorecard
Governance Scorecard. Lei, L. n.d.
http://bschool.nus.edu/Departments
/FinanceNAccounting/seminars/pap
ers/luo%20lei-defence.doc. Feb 28
info from annual report
use a scorecard developed by

Standard & Poors to assess the
corporate governance of U.K. listed
companies. It provides a
comprehensive measure of the
extent to which a company has
adopted international best practices
Ninety three of the questions are
binary questions and one point is
given for each best practice
complied with and zero otherwise
or if the company did not disclose
whether it had or not complied with
such best practice. The remaining
questions were answered with
specific integersequal weighting to
each measureScores on the 119
questions are grouped into five
categories of corporate
governance: Board Matters,
Nomination Matters, Remuneration
Matters, Audit Matters and
Communication. We compute the
composite governance scorecard
by summing up the scores for each
group.
Findings
The evidence on whether there is a

link between governance structure
and performance remains weak.
We argue that one possible reason
could be due to the research
methodology. Earlier research has
examined subsets of governance
mechanisms, usually one or two
governance variables only
Mariah

retrieved)

Methodology/Statistical Technique
to the Topic
dependent & independent variables)
-examine the quality of financial

reporting of earnings and the
accrual and cash flow components
of earnings by IPO firms. They were
also able to examine which
The financial variables of interest in
component(accrual or cash flow) of this study are earnings, accruals,
earnings is more susceptible to
and cash from operations. mej di ko
Earnings Quality and Corporate
earnings management and
gets ung sinasabi nia ditoordered
Governance in IPO firmsMary F.
influenced by corporate governance logit regression model = dependent
Calegari & M. A. HarjotoJanuary 1 factors-analyzed the quality of
2008
earnings by examining the stability variable is a discreet variable that
http://scholarworks.sjsu.edu/cgi/vie of earnings and its components for takes the value of 1 (bottom
quartile, Ql), 2 (second quartile
wcontent.cgi?article=1004&context IPO firms that are ranked into
from the bottom, Q2), 3 (second
=acc_fin_pub
quartile portfolios-investigate the
quartile from the top, Q3), and 4
influence of corporate governance (top quartile, Q4) to represent the
on the likelihood that IPO firms will four quartiles.
be in the first,second, third , or
fourth quartiles of
earnings,accruals, or cash flows in
the IPO year and two subsequent
years
The Role of Corporate Governance
in Reducing the Negative Effect of
Earnings Management
Nopphon Tangjitprom National
Institute of Development
Administration & Assumption
University, Bangkok, Thailand
examine the role of corporate
International Journal of Economics governance in reducing the
and Finance; Vol. 5, No. 3; 2013 negative effect of earnings
ISSN 1916-971X E-ISSN 1916- management
9728
Published by Canadian Center of
Science and Education
http://papers.ssrn.com/sol3/papers.c
fm?abstract_id=2225979
Findings
Transition Matrix
document the migration of firms'
earnings, accruals, and cash flows
across the different quartiles during
the two-year period after the
IPOshows the percentage of firms
that remain in the same quartile
and the percentage of firms that
move to different (terminal)
quartiles. during the first and
second year after the IPO. ordered
logit regression model
examine the impact of corporate
governance on the likelihood of IPO
firms to be in the first, second, third,
and fourth quartiles of earnings,
accruals, or cash flows during the
two years after the IPO.
accrual component exhibited

greater instability compared to
earnings and cash flows,
suggesting earnings consisting
primarily . of accruals are of lower
quality than earnings comprised
primarily of cash flows. Using an
ordered logit model, it is discovered
that !PO firms are more likely to be
in the top quartile of earnings and
cash flows when they are older,
larger, and have stronger corporate
governance. Fi rms are more likely
to report greater accruals when
they are smaller and have weaker
governance.
the relationship between firm value

and earning management will be
The data used in this research
include all firms traded on the New examined. Firm value was
measured by Tobins Q, which is
York Stock Exchange (NYSE) or
the ratio between the market value
NASDAQ during 2002-2010The
a firm and the book value of a
Corporate Governance Score was of
firm. In other words,Tobins Q is the
provided by ASSET4, an affiliate of market value of a firm scaled down
Thomson Reuters, that provides
by its book value.examine the effect
Environmental, Social, and
of CG on the relationship between
Governance (ESG) data for
firm value and earnings
worldwide firms.
management by categorizing all
firms based on the CG score
The results in this paper provide

evidence to support the role of
corporate governance in reducing
harmful
earnings management rather than
beneficial earnings management.
The evidence in this research
shows that the
effect of earnings management on
firm value is less negative for goodgovernance firms. Firms with poor
governance face the negative effect
of earnings management because
these firms are more vulnerable to
managerial opportunism.
Mariah

retrieved)
Financial Reporting Quality The
Case of Tunisian Firms
International Business Research
Vol. 4, No. 1; January 2011 Nesrine
Klai
https://www.google.com.ph/url?sa=t
&rct=j&q=&esrc=s&source=web&cd
=1&sqi=2&ved=0CCEQFjAA&url=ht
tp%3A%2F%2Fwww.ccsenet.org%
2Fjournal%2Findex.php%2Fibr%2F
article%2Fdownload%2F7795%2F6
435&ei=yOLyVI3GBaK2mwXClILo
Dw&usg=AFQjCNFJwSc3rA4dyLN
D7kbbUohL78WIg&sig2=hPuPh5qiVuO
fPwiSvmQimg&bvm=bv.87269000,
d.dGY

to the Topic
examine the effect of the

governance mechanisms on the
financial reporting quality for a
sample of
Tunisian firms. Specifically, we
focus on the characteristics of the
board of directors and the
ownership structure of the firms
listed on the Tunis Stock Exchange
during the period 19972007.
22
non financial firms listed on the
Tunis Stock Exchange during the
period 1997-2007.
measure the financial information

quality using two models. The first
one is the McNichols model which
considers the standard deviation of
the residuals or the error terms as a
measure of reporting quality.
second model captures the
information content of earning
Findings
governance mechanisms affect the

financial information quality of the
Tunisian companies. Particularly,
the power of the foreigners, the
families and the blockholders
reduces the reporting quality, while
the control by the State and the
financial institutions is associated
with a good quality of financial
disclosure
Mariah

retrieved)
Corporate Governance and Its
Impact on the Quality of Accounting
Information in the
Industrial Community Shareholding
Companies Listed in Amman
Financial Market- Jordan
Dr. Fares Jamil Al_Sufy
Assistant Professor
Al-Isra University
College of Business Administration
and Finance
Accounting Department
Amman, Jordan
DR. Haitham Idrees Mohamad
Almbaideen
Assistant Professor
Al-Isra University
and Finance
Amman, Jordan
Dr. Haitham Mamdouh Al_abbadi
Associate Professor
Amman Arab University
and Finance
Amman- Jordan
Mohammed Hassan Makhlouf
Teacher
Al-Isra University
and Finance
Amman, Jordan
International Journal of Humanities
and Social Science Vol. 3 No. 5;
March 2013
http://www.ijhssnet.com/journals/Vo
l_3_No_5_March_2013/18.pdf

to the Topic
examined the impact of governance

on the quality of Accounting
Information, a field study on
industrial firms listed in Amman
Financial Market. Where they were
addressed to the concept of
governance and
the statement of its importance, its
objectives, principles and the role of
corporate governance in Jordan,
and
the impact of quality of financial
reports to the principles of
corporate governance has been
used of the two
researchers descriptive analytical
method in the study by collecting
data from sources of primary and
secondary,
where data was collected through a
questionnaire specially prepared for
this reason, were disseminated to
the
study population numbering 50
industrial companies, have been
using the Statistical Package for the
Social
Sciences (SPSS) in analyzing the
data and testing the suggestion
hypotheses
Findings
1. The study found that there are

fully aware of the designers and
users of financial statements of the
concept of corporate governance
and the foundations of their
application in industrial companies
listed on the contribution of Jordan
Amman Financial Market.
2. The study concluded that there is
effective implementation of the
principles of corporate governance
affect the quality of financial
The study relied on the approach
reporting and makes it more
descriptive appropriateness for their accurate and quality in a
purposes by review the literature
community study.
theory onthe subject of the
3. The study found that there is a
movement of companies and their relationship between corporate
impact on the quality of accounting governance principles (the principle
The study population consists of
information in the industrial
of the protection of investors,
companies listed in Amman Stock companies listed at Amman
shareholders) and the quality of
Exchange told the officials and
Financial Market, as well as a
financial reporting.
financial managers working in these review of previous studies relevant. 4. The study found that there is a
companies, sample was selected
The study was also on the
randomly of the community
curriculum field by relying on
governance (the principle of the
representation on the basis of
questionnaire
designed
for
the
family equal to the shareholders)
statistical methods adopted in this
purposes
of
this
study
was
to
and the quality of financial reports
area.
gather evidence and analysis of
5. The study concluded that there is
access to the results of Alrdasp
a relationship between corporate
entirely positive, for research
governance (the principle of the
questions and test hypotheses,
role of stakeholders in the methods
provide a set of recommendations of the exercise of management
in light of the results.
companies) and the quality of
financial
reporting.
6. There is a relationship between
corporate governance (the principle
responsibilities of transparency)
and the quality of financial
reporting.
7. There is a relationship between
corporate governance principles
(the principle responsibilities of the
Board of Directors) and the quality
of financial reporting.
Mariah

retrieved)

to the Topic
Findings
IFRS improves the predictive value

and timeliness, and it cant
influences representational
faithfulness significantly. Second,
the information asymmetry
degrades the quality of accounting
information. Nevertheless, IFRS
can improve the information
asymmetry but promote the quality
of accounting information is
THE EFFECT OF IFRS,
investigates the relationship
nonsignificantly. Third, state
INFORMATION ASYMMETRY
between the information
ownership, manager ownership,
AND CORPORATE
asymmetry, the ownership
blockholder and directorsGOVERNANCE ON THE QUALITY structure, the pledge of directorsexamine the 42 companies issuing
supervisor ownership would affect
OF ACCOUNTING INFORMATION supervisor, respectively, and the
both A shares and B shares on
the quality of accounting
Hui-Sung Kao
quality of accounting information
Shenzhen
Stock
information. IFRS would restrain
Associate Professor, Department of under different accounting
Exchange
and
44
companies
negative effect of state ownership,
Accounting, Feng Chia University, standards. By considering A and B
both shares on Shanghai
used four different empirical models manager ownership, blockholder
Taiwan
stock market of China, which apply issuing
Stock Exchange Dependent
to test relationship
and directors-supervisor ownership
Tzu-Han Wei
China GAAP and IFRS, it
variables: Accounting Information
and could enhance predictive value
Graduate Student, Department of alsodiscuss whether IFRS can
Quality; Independent variables:
and timeliness. Finally, the pledge
Accounting, Feng Chia University, reduce negative effects of the
IFRS, Information Asymmetry and
of directors-supervisor would
Taiwan
information asymmetry, the
reduce the quality of accounting
Asian Economic and Financial
ownership structure, the pledge of Corporate Governance
information. However, IFRS can
Review, 2014, 4(2):226-256
directors, and furthermore promote
confine negative effects of the
http://www.aessweb.com/pdfthe quality of accounting
pledge of directors-supervisor but
files/aefr%204(2),%20226-256.pdf information effectively
cant promote the quality of
accounting information significantly.
As a result, adopting IFRS could
enhance the quality of accounting
information significantly.
Nevertheless, IFRS need to reduce
information asymmetry and use
corporate governance mechanism
to promote the quality of accounting
information
Mariah

retrieved)

to the Topic
attempts to utilize the association

of newly-created Corporate
Governance which measures from
the Corporate Governance Scores
of the Thai Institute of Directors
(IOD) in the Stock Exchange of
Thailand (SET) in the year 2011 as
THE RELATIONSHIP BETWEEN independent variable, which the
higher IOD score usually reflext the
AND
higher level of Corporate
EARNINGS QUALITY : A CASE
Governance and earnings quality
STUDY OF LISTED COMPANIES as the dependent variable which
IN
used the variance and risk, which
THE STOCK EXCHANGE OF
measured using standard deviation
THAILAND (SET)
Standard deviation is a standard
Sasivimol Meeampol
measure of investment risk. This
Kasetsart University, Thailand
IODs score compares almost all
fbussas@ku.ac.th
listed firms with the criteria
see summary
Vimol Rodpetch
established in the principles of
corporate governance. The chiPhanthipa Srinammuang
square was used to test this
relationship at 95% confidence.
Ausa Wongsorntham
Results of analysis highlights that
Kasetsart University, Thailand;
the standard deviation of firms
June 2013;
listed in the SET for year 2011 is
http://www.toknowpress.net/ISBN/9 have the associated with IOD
78-961-6914-02-4/papers/ML13Score. In summary, the high
460.pdf
Corporate Governance measured
by IOD score shows earnings
quality. In this study means that the
firm which has a high IOD score,
which means high corporate
governance will have earnings
quality which measure by using
standard deviation.
Earnings Quality:
International Evidence
Cristina Gaio
examine the relationship between
ISEG Universidade de Lisboa
corporate governance and earnings
Clara C. Raposo
quality worldwide
ISEG Universidade de Lisboa;
2014; http://www.nabusinesspress.com/JAF/RaposoCC
_Web14_3_.pdf
see summary
Findings
standard deviation of firms listed in

the stock Exchange of Thailand
(SET) for the year 2011 has
associated with IOD scores at 5
percent significance
level.Consistent with Jiang, Lee
and Anandarajan (2008) studied
the relationship between corporate
governance and earnings quality
measured by using corporate
governance scores and this result
that
the firm has high corporate
governance scores will be lower
earnings management and
earnings quality will be higher
-Results suggest a substitute

governance and earnings quality;
country effect is extremely relevant
in shaping this relationship
Mariah
Bibliography Details (title. author. Summary of Abstract/ Contribution

to the Topic
retrieved)
A Brief Analysis of the Effect of the
Corporate Governance on the
Accounting Information Quality
GONG Chun
Southwest University of Science
effect of corporate governance on
and Technology, P.R.China,
accounting information quality
621010;
http://www.seiofbluemountain.com/
upload/product/201111/2011kjxid1.
pdf
company governance on the

accounting information quality has
the important influence. It is must
be from internal and external
management structure to improve
corporate governance, for the
management of accounting
information quality to provide
reliable basis
Corporate Governance and The

Quality Of Financial Disclosures
Mark Myring, Ball State University,
USA
Rebecca Toppe Shortridge,
Northern Illinois University, USA;
International Business &
Economics Research Journal
June 2010 Volume 9, Number 6
there is limited evidence of a

relation between corporate
governance quality and the
characteristics of analyst forecasts.
stronger corporate governance
ratings, as evaluated by The
Corporate Library, do not seem to
influence the information
environment faced by analysts.
This study employs analyst

earnings forecasts to determine
whether corporate governance
procedures impact the quality of
accounting information
dependent: expected dispersion,

expected squared error in the mean
forecast, and the number of
analysts issuing forecasts;
independent:corporate governance
ratings from the The Corporate
Library
Earnings Quality, Corporate

Governance, and Earnings Quality
Vasiliki Athanasakou
London School of Economics
Per Olsson
Duke University
http://fisher.osu.edu/supplements/1
0/12906/presentationpaper_Olsson
_9-5-12.pdf
The analysis shows how earnings

quality shapes and is shaped by
corporate governance, depending
on its source
Does Corporate Governance affect

Earnings Quality: Evidence from an
Emerging Market
Muhammad Nurul Houqe, Tony van
Zijl, Keitha Dunstan, A.K.M.
Waresul Karim;
cfm?abstract_id=1726134
examines whether firm governance sample of 648 firm-year

practices have an effect on
observations for the period of 2001
accounting earnings quality in
- 2006
Bangladesh
first define the empirical earnings

quality measures, next describe
how to obtain the innate and
discretionary components of
earnings quality and, finally,
present the models for testing how
earnings quality shapes and is
shaped by corporate governance
structures.
Findings
corporate governance structures

are stronger when innate earnings
quality is poor and that
discretionary earnings quality
improves with stronger governance
structures
corporate governance mechanisms

provide greater monitoring of
financial reporting and these
mechanisms positively affect firm
earnings quality
Kim

retrieved)
The Effect of Corporate

Governance on Earnings Quality:
Evidence from Koreas Corporate
Governance Reform. Yo Han An.
2009.

to the Topic
This thesis investigates the effect of

corporate governance on earnings
quality, following changes in
corporate governance mechanisms
in Korea, launched after the Asian
Financial Crisis in 1997.
The paper synthesizes major

research findings in the accounting
governance literature and extend
Bushman and Smith to consider
corporate transparency more
Transparency, Financial Accounting generally, which includes financial
Information, and Corporate
accounting information as one
Governance. Robert M. Bushman element of a complex information
and Abbie J. Smith. 2003.
infrastructure.
An economics-based research
focused primarily on the
governance role of financial
accounting information .
ASEAN Corporate Governance

Scorecard. ACMF. 2011.
http://www.theacmf.org/ACMF/uplo
ad/asean_cg_scorecard.pdf. March
1, 2015
What Determines Corporate

Transparency? Bushman,
Piotrioski, and Smith. 2004. Volume
42 No. 2 Journal of Accounting
Research.
Independent Variable: The

Corporate Governance
measurement.
Dependent Variable: Earnings
quality as substitute for financial
reporting quality
Corporate Governance They

provide a framework for
understanding the operation of
accounting information in an
economy. This framework isolates
three channels through which
financial accounting information can
affect the investments, productivity,
and value-added of firms.
In terms of methodology, this thesis

employed three corporate
governance mechanisms based on
the Koreas corporate governance
reforms: 1) Ownership structure
(family ownership and foreign
ownership), 2) Internal governance
(outside directors on the board and
audit committee), and 3) External
governance (external auditor). The
primary estimation method for the
regression equations is pooledOLS.
This study provides evidence that

high quality financial reporting
(reliable and relevant accounting
earnings quality) requires wellbalanced corporate governance
mechanisms.
These channels involve the use of

financial accounting information: 1)
to identify promising investment
opportunities, 2) to discipline
managers to direct resources
toward projects identified as good
and away from projects that
primarily benefit managers rather
than owners of capital, and to
prevent stealing, and 3) to reduce
information asymmetries among
investors.
presents evidence that dissident

stockholders typically cite poor
earnings performance as evidence
of incumbent managers inefficiency
(and rarely cite stock price
performance), and that incumbent
managers use their accounting
discretion to portray a more
favorable impression of their
performance to voting shareholders
The ASEAN group members have

initiated to create a corporate
governance scorecard for the
Corporate Governance There
upcoming 2015 ASEAN integration. are steps on how they were able to They based it in OECD principles.
This could help us define the core conduct and create their scorecard.
key points to include as one of our
factors.
This paper investigates

transparency through 2 factors, (1)
financial transparency and (2)
governance transparency.
Their independent variable is

Transparency which is measured
by dependent variables such as
timeliness of disclosures and
Findings
Provided a framework for

conceptualizing and measuring
information systems that contribute
to corporate transparency.
Descriptive StatisticsPearson and
Spearman correlations and their
two-tailed probability levels
They have a completed structured

scorecard.
Their main multivariate result is that

the governance transparency factor
is primarily related to legal regime,
whereas the financial transparency
factor is primarily related to political
economy.
Kim
ASEAN Corporate Governance

Scorecard. ACMF & ADB. 20122013.
http://www.theacmf.org/ACMF/uplo It has a corporate governance
Corporate governance scorecard
ad/asean_corporate_governance_s scorecard for each ASEAN country.
corecard_country_report_20122013.pdf. March 1, 2015.
Financial accounting and corporate

governance:a discussion. Sloan.
They provide a link between
2001.
Governance and
http://webkuliah.unimedia.ac.id/ebo Corporate
financial accounting.
ok/files/sloan(2001)%20acc%20gov
%20comment.pdf. March 1, 2015.
Evolution and determinants of firmlevel corporate governance quality

in Brazil. Alexandre Di Miceli da
Silveira, Ricardo Pereira Camara,
Leal Lucas Ayres, Barreira de
Campos, Barros Andre Luiz, and
Carvalhal-da-Silva. 2009. R.Adm.,
Sao Paulo, v.44, n.3, p.173-189
From this perspective, firm

ownership structures and
consequently their corporate
Independent Variable: Corporate
governance model can be seen as governance quality at firm level
an equilibrium response to the legal
environment in which they operate.
Corporate Governance and the

Determinants of Investment.
This paper mainly focuses
Gugler, Mueller, and Yurtoglu.
corporate governances effect on
2007.
http://www.wu.ac.at/iqv/mitarbeiter/ investment.
gugler/gmy_jite.pdf. March 1, 2015.
AND FIRM PERFORMANCE:
EMPIRICAL EVIDENCE FROM
VIETNAM. DUC VO & THUY
PHAN. 2013.
http://www.murdoch.edu.au/Schoolof-Management-andGovernance/_document/AustralianConference-ofEconomists/Corporate-governanceand-firm-performance.pdf. March 1,
2015.
Evaluation of accounting scholars

contribution to governance
researchOverview of the roles
played by accounting in corporate
governance
They have chosen top 50 publicly

listed firms.
Corporate governance principles

provide guidance on how
corporations should operate and
can be useful to attract foreign
investments.
------
Financial accounting is a key

ingredient in the corporate
governance process. A complex set
of institutions and rules have
evolved to facilitate the financial
reporting process, and the
information provided by this
process is an important input to
major governance mechanisms.
A key contribution is to examine the

nature of totally voluntary adoption
Pooled OLS and Fixed Effects
of corporate governance guidelines
panel data regression procedures in the Brazilian environment, which
Statistics for the Corporate
has almost no listing requirement,
Governance Index (CGI) and Sub- over a reasonable time span, given
Indices
that most studies use cross-section
samples covering one or very few
years only.
Independent variable: Determinants ---of Investment

(Their methodology is for
investment quality--AIT and MDT
Dependent variable: Corporate
models)
governance
This study aims to quantify the

Relationship between Corporate
contribution of corporate
governance to the performance for Governance and Firms
performance.
listed companies in Vietnam
feasible general least square

(FGLS) technique
Legal systems, accounting

standards, and ownership structure
systematically affect the
investmentcash flow sensitivity.
The relationship could be: (i)

positively correlated; (ii) negatively
correlated; (iii) non-linearly
correlated; and no correlation at
all.no link between independent
directors and firms
performanceboard size will
contribute negatively to firms
performance for Vietnams listed
firms
Kim
Corporate Governance, Manager

Behavior, and Analyst Behavior as
Determinants of Mergers and
Acquisitions. Al Bhimani & Mthuli
Ncube. N.d.
http://www.econrsa.org/papers/w_p
apers/wp14.pdf. March 1, 2015.
In this paper presents integrated

framework between manager
behavior and corporate
governance, and show how a
manager can use M&A bids as a
vehicle for maximising their own
benefits, rather than shareholder
value.
Corporate Governance in China:

Current Practices, Economic
Effects, and Institutional
Determinants. Qiao Liu. 2005.
http://www.hiebs.hku.hk/working_p
aper_updates/pdf/wp1125.pdf.
March 1, 2015.
(1) What are the current corporate

governance practices in China? (2)
How do these corporate
governance practices affect
Chinese firms valuation and
Independent Variable: Corporate
various corporate policies? (3) How Governance in Chinas firms
does Chinas unique institutional
setting pre-determine the
governance model adopted in
China?
Merger and Acquisition and

Corporate Governance
Multiple statistical models
The analysts forecast inflated

earnings for a company because
the fees they earn as a portion of
what the investment bank earns,
are related to the size of the
transaction which in turn is
determined by the inflated future
earnings.
Control-based Model
The evidence also shows that

Chinese firms, whose corporate
governance practices deviate from
the control based model,
demonstrate stronger performance,
and tend to make decisions in line
with the shareholders interest.
Eunice

retrieved)

to the Topic
Board independence and firm

performance in China
relationship between board

independence and firm
performance in China.
Corporate governance and firm

value
relation between firm-level

corporate governance and firm
value
Executive compensation and

corporate governance in China
investigate executive compensation

and corporate governance in
China's publicly traded
firms
Performance measures;
Independent directors
Tobin's Q or stock returns
Findings
independent directors have an

overall
positive effect on firm operating
performance in China
strong and positive relation

between firm-level corporate
governance and
firm valuation.
executive compensation and

corporate governance data;
financial performance and
accounting data
fixed-effects panel data model,
executive compensation is
positively correlated to firm
performance
Executive compensation,
organizational performance, and
governance quality in the absence
of owners
relationship between chief

executive compensation,
organizational performance, and
governance quality in large U.S.
nonprofits
negative relationship between

CEO-to-employee relative pay and
multiple measures of nonprofit
performance. These results
highlight the importance of strong
governance mechanisms in
mitigating high levels of relative
pay to and poor performance by
executives in organizations
How do firm- and country-level

governance
mechanisms affect firms
disclosure?
The influence of director stock
ownership and board discussion
transparency on financial reporting
quality
examines how a countrys

regulatory environment interacts
with firms institutional corporate
governance arrangements to
affect the disclosure that these
firms provide in their annual
reports.
We find that the impact of

corporate governance on disclosure
is particularly pronounced in weak
legal environments
Mandatory IFRS adoption and

executive
compensation: Evidence from
China
investigates how the mandatory

adoption of International Financial
compensation,
OLS change model to analyze the
Reporting Standards (IFRS) affects Executive
accounting performance and IFRS influence of IFRS adoption on
the contractual benefits of using
adoption
executive compensation
accounting information to determine
executive compensation
strong
evidence supporting the positive
role of mandatory IFRS adoption on
the
accounting-based performance
sensitivity of executive
compensation
Eunice

retrieved)
The Impact of Corporate
Governance on IFRS Adoption
Choices

to the Topic
association between corporate
governance strength and
EU listed firms choices with
respect to International Financial
Reporting Standards
(IFRS) adoption in 2005.
Corporate governance and pay-for- impact of governance structure and dependent variable= earnings
performance: The impact of
incentive-based compensation on management
earnings management
explanatory variables
firm performance
are corporate governance
The impact of corporate

governance and external audit on
compliance
to mandatory disclosure
requirements in China
quantify the impact of

corporate governance and external
audits on compliance to mandatory
disclosure requirements
Voluntary forward-looking
statements driven by
corporate governance and their
value relevance
examines the impact of corporate

governance on the
level of voluntary disclosures of
forward-looking statements in
the narrative sections of annual
reports
Findings
stronger governance firms disclose

more information
modified Jones model
earnings management through the

use of discretionary accruals
responds dramatically to
management incentives
improved internal governance led to
higher compliance to disclosure
requirements.
The external governance
environment, measured by the
degree of institutional
development, had a positive effect
on firms compliance to disclosure
requirements.
corporate governance influences

multivariate OLS regression; panel companies decisions
regression procedure
to voluntarily disclose these
statements.

Corporate Governance Impacts Earnings Management

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Corporate Governance and

Summary of Abstract/ Contribution

examined the association between

inverse relationship since corp

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Summary of Abstract/ Contribution

Corp governance indices

The Effects of Corporate

dependent variable: earnings

adjusted Jones Model to estimate

suggests that there are 14

have negative significant effect on

Bibliography Details (title. author.

Summary of Abstract/ Contribution

Corporate Governance and

surveys a vast body of literature

examine the accounting standards

Corporate Governance and Firm

corporate governance is likely to

firms with having good corporate

Bibliography Details (title. author.

Does Weak Governance Cause

Summary of Abstract/ Contribution

authors argue that investors should

firms with high

used GIM index for shareholder

authors find that stock analysts

Bibliography Details (title. author.

Summary of Abstract/ Contribution

The Determinants of Corporate

info from annual report

use a scorecard developed by

The evidence on whether there is a

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Summary of Abstract/ Contribution

-examine the quality of financial

accrual component exhibited

the relationship between firm value

The results in this paper provide

Bibliography Details (title. author.

Summary of Abstract/ Contribution

examine the effect of the

measure the financial information

governance mechanisms affect the

Bibliography Details (title. author.

Summary of Abstract/ Contribution

examined the impact of governance

1. The study found that there are

Bibliography Details (title. author.

Summary of Abstract/ Contribution

IFRS improves the predictive value

Bibliography Details (title. author.

Summary of Abstract/ Contribution

attempts to utilize the association

standard deviation of firms listed in

-Results suggest a substitute

Bibliography Details (title. author. Summary of Abstract/ Contribution

company governance on the

Corporate Governance and The

there is limited evidence of a