El Diri, M orcid.org/0000-0001-8767-3424, Lambrinoudakis, C orcid.org/0000-0002-6575-9814 and Alhadab, M (2020) Corporate governance and earnings management in concentrated markets. Journal of Business Research, 108. pp. 291-306. ISSN 0148-2963
Abstract
This study examines the difference between high and low concentrated markets in using accrual and real earnings management and the role of corporate governance in mitigating such activities across the two types of markets. We find that firms operating in concentrated markets use more accrual and real earnings management compared to those in non-concentrated markets. Furthermore, we find evidence that corporate governance, in the form of quality board characteristics, is more effective in mitigating earnings management in non-concentrated markets. In contrast, corporate governance in concentrated markets drives managers to substitute accrual with real earnings management as the latter is less easily detectable and its long-term negative consequences on firm value are likely to be mitigated by the higher competitive power of firms in concentrated markets. The findings of this study are potentially useful to regulators in enhancing the legitimacy of corporate governance in concentrated markets.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2019 Elsevier Inc. All rights reserved. This is an author produced version of a paper published in Journal of Business Research. Uploaded in accordance with the publisher's self-archiving policy. |
Keywords: | Corporate governance; Board of directors; Accrual earnings management; Real earnings management; Market concentration |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Accounting & Finance Division (LUBS) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 20 Nov 2019 12:21 |
Last Modified: | 14 Dec 2023 14:36 |
Status: | Published |
Publisher: | Elsevier |
Identification Number: | 10.1016/j.jbusres.2019.11.013 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:153654 |