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Corporate disclosure theories and financial accounting research

(2019)
Author
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(UGent)
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Abstract
Sound corporate governance has an important role in providing transparent and reliable information to the financial markets concerning firm performance. Consequently, it has remained a popular topic of research in the accounting and finance arena. When it comes to policy implications, research results in corporate governance provide important guidelines for the EU member states and top business decision makers around the world. While corporate governance theories can be applied in different research scenarios based on a given set of premises, in this thesis we focus on corporate disclosure theories and accounting conservatism building an empirical methodology to verify the research hypotheses using statistical models. The thesis is divided into three parts. In the first two parts, the relation between firm specific characteristics and corporate disclosure are discussed in the context of Scandinavian firms. Corporate disclosure is often used to understand the increasing need to reduce managerial opportunism and insider trading as well as the risks related to moral hazards and the agency problem, which are some of the most fundamental theories established in the domain of managerial science. By the specific geographical focus, new insights on the regional differences and transferability of the existing results is obtained. As a principal research tool in addition to modelling the publicly available financial data, a linguistic analysis of financial reports is performed. Correlation and regression analyses reveal that in terms of firm size, leverage ratio, the existence of audit committee and the independence of CEO, there is a correlation between firm specific factors and the level of disclosure. In the second part of the thesis, the more specific context of intellectual capital disclosure is discussed. The third part of the thesis discusses accounting conservatism. In the earlier literature, the two types of conservatism common in the literature are known as conditional and unconditional conservatism while the work in this thesis covers both cases. In this context, the presence of accounting conservatism is discussed using a set of recent data containing a large amount of financial information. The empirical study verifies that accounting conservatism occurs in the form of undervaluation of investments in positive net present value projects, whereas no strong evidence is found to the undervaluation of assets due to factors such as an overly aggressive deprecation policy. In contrast to a large part of the earlier literature, in all the models in the thesis a special precaution is taken in order to address the possible presence of heteroscedasticity.
Goed ondernemingsbestuur speelt een belangrijke rol bij het verstrekken van transparante en betrouwbare informatie aan de financiële markten over bedrijfsprestaties. Bijgevolg is het een populair onderzoeksonderwerp gebleven op het gebied van boekhouding en financiën. Als het gaat om beleidsimplicaties, bieden onderzoeksresultaten inzake corporate governance belangrijke richtlijnen voor de EUlidstaten en leidinggevende zakelijke besluitvormers over de hele wereld. Hoewel corporate governance-theorieën kunnen worden toegepast in verschillende onderzoeksscenario's op basis van een bepaalde reeks uitgangspunten, richten we ons in dit proefschrift op theorieën over de openbaarmaking van bedrijfsgegevens en boekhoudkundig conservatisme, waarbij een empirische methodologie wordt gebruikt om de onderzoekshypothesen te verifiëren met behulp van statistische modellen. Het proefschrift bestaat uit drie delen. In de eerste twee delen wordt de relatie tussen bedrijfsspecifieke kenmerken en openbaarmaking van bedrijfsgegevens besproken in de context van Scandinavische bedrijven. Openbaarmaking van bedrijfsgegevens wordt vaak gebruikt om de toenemende behoefte te begrijpen om opportunistisch handelen door het management en handel met voorkennis te verminderen, evenals de risico's in verband met moreel wangedrag en het principaal-agent probleem, die enkele van de meest fundamentele theorieën zijn in het domein van de managementwetenschap. Door de specifieke geografische focus worden nieuwe inzichten verkregen in de regionale verschillen en overdraagbaarheid van de bestaande resultaten. Als een belangrijk onderzoeksinstrument naast het modelleren van de openbaar beschikbare financiële gegevens, wordt een taalkundige analyse van financiële rapporten uitgevoerd. Correlatieen regressieanalyses laten zien dat er, wat betreft bedrijfsgrootte, leverage ratio, het bestaan van een auditcomité en de onafhankelijkheid van CEO, een correlatie bestaat tussen bedrijfsspecifieke factoren en het niveau van openbaarmaking. In het tweede deel van het proefschrift wordt de meer specifieke context van openbaarmaking van intellectueel kapitaal besproken. Het derde deel van het proefschrift bespreekt boekhoudkundig conservatisme. In de eerdere literatuur staan de twee soorten conservatisme die gebruikelijk zijn in de literatuur bekend als voorwaardelijk en niet-voorwaardelijk conservatisme, terwijl het werk in dit proefschrift beide types omvat. In deze context wordt de aanwezigheid van boekhoudkundig conservatisme besproken met behulp van een reeks recente gegevens die een grote hoeveelheid financiële informatie bevatten. De empirische studie verifieert dat boekhoudkundig conservatisme optreedt in de vorm van onderwaardering van investeringen in positieve netto contante waardeprojecten, terwijl er geen sterk bewijs wordt gevonden voor de onderwaardering van activa als gevolg van factoren zoals een te agressief afschrijvingsbeleid. In tegenstelling tot een groot deel van de eerdere literatuur wordt in alle modellen in het proefschrift een speciale voorzorgsmaatregel getroffen om de mogelijke aanwezigheid van heteroscedasticiteit aan te pakken.

Citation

Please use this url to cite or link to this publication:

MLA
Xia, Belle Selene. Corporate Disclosure Theories and Financial Accounting Research  . Ghent University. Faculty of Economics and Business Administration, 2019.
APA
Xia, B. S. (2019). Corporate disclosure theories and financial accounting research  . Ghent University. Faculty of Economics and Business Administration, Ghent, Belgium.
Chicago author-date
Xia, Belle Selene. 2019. “Corporate Disclosure Theories and Financial Accounting Research  .” Ghent, Belgium: Ghent University. Faculty of Economics and Business Administration.
Chicago author-date (all authors)
Xia, Belle Selene. 2019. “Corporate Disclosure Theories and Financial Accounting Research  .” Ghent, Belgium: Ghent University. Faculty of Economics and Business Administration.
Vancouver
1.
Xia BS. Corporate disclosure theories and financial accounting research  . [Ghent, Belgium]: Ghent University. Faculty of Economics and Business Administration; 2019.
IEEE
[1]
B. S. Xia, “Corporate disclosure theories and financial accounting research  ,” Ghent University. Faculty of Economics and Business Administration, Ghent, Belgium, 2019.
@phdthesis{8631035,
  abstract     = {Sound corporate governance has an important role in providing transparent and reliable information to the financial markets concerning firm performance. Consequently, it has remained a popular topic of research in the accounting and finance arena. When it comes to policy implications, research results in corporate governance provide important
guidelines for the EU member states and top business decision makers around the world. While corporate governance theories can be applied in different research scenarios based on a given set of premises, in this thesis we focus on corporate disclosure theories and accounting conservatism building an empirical methodology to verify the research hypotheses using statistical models. 
The thesis is divided into three parts. In the first two parts, the relation between firm specific characteristics and corporate disclosure are discussed in the context of Scandinavian firms. Corporate disclosure is often used to understand the increasing need to reduce managerial opportunism and insider trading as well as the risks related to moral hazards and the agency problem, which are some of the most fundamental theories established in the domain of managerial science. By the specific geographical focus, new insights on the regional differences and transferability of the existing results is obtained. As a principal research tool in addition to modelling the publicly available financial data, a linguistic analysis of financial reports is performed. Correlation and regression analyses reveal that in terms of firm size, leverage ratio, the existence of audit committee and the independence of CEO, there is a correlation between firm specific factors and the level of disclosure. In the second part of the thesis, the more specific context of intellectual capital disclosure is discussed.
The third part of the thesis discusses accounting conservatism. In the earlier literature, the two types of conservatism common in the literature are known as conditional and unconditional conservatism while the work in this thesis covers both cases. In this context, the presence of accounting conservatism is discussed using a set of recent data containing a large amount of financial information. The empirical study verifies that accounting conservatism occurs in the form of undervaluation of investments in positive net present value projects, whereas no strong evidence is found to the undervaluation of assets due to factors such as an overly aggressive deprecation policy. In contrast to a large part of the earlier literature, in all the models in the thesis a special precaution is taken in order to address the possible presence of heteroscedasticity. },
  author       = {Xia, Belle Selene},
  language     = {eng},
  pages        = {77},
  publisher    = {Ghent University. Faculty of Economics and Business Administration},
  school       = {Ghent University},
  title        = {Corporate disclosure theories and financial accounting research   },
  year         = {2019},
}