Purpose This study aims to investigate the effects of corporate board and audit committee characteristics and ownership structures on market-based financial performance of listed firms in Thailand. Design/methodology/approach It applies system GMM (generalized method of moments) as the baseline estimator approach, and ordinary least squares and fixed effects for robustness checks on a sample of 452 firms listed on the Thai Stock Exchange for the period 2000-2016. Findings Relying mainly on the system GMM estimator, the empirical results indicate some emerging trends in the Thai economy. Contrary to expectations for an emerging market and prior research findings, ownership structures, particularly ownership concentration and family ownership, appear to have no significant influence on market-based firm performance, while managerial ownership exerts a positive effect on performance. Moreover, as expected, board structure variables such as board independence; size; meeting and dual role; and audit committee meeting show significant explanatory power on market-based firm performance in Thai firms. Practical implications These findings are important for policymakers in constructing an appropriate set of governance mechanisms in an emerging market context, and for corporate entities and investors in shaping their understanding of corporate governance in the Thai institutional context. Originality/value Unlike previous literature on the Thai market, this study is the first to use the more advanced econometric method known as system GMM estimator for addressing causality/endogeneity issues in governance–performance relationships. The findings indicate new trends in the explanatory power of ownership structure variables on market-based firm performance in Thai-listed firms.

Purpose This study aims to explore corporate earnings management practices in Australia and New Zealand before and after the regulatory changes and corporate governance reforms. The study argues that the effectiveness of regulatory reforms has to be reflected in constraining earnings management in post-reform period as compared to pre-reform period. Design/methodology/approach Using a sample of 3,966 firm-year observations, including all ASX and NZX listed firms for the period 2001-2006, the study examines earnings management practices in both countries in pre- and post-reform periods with appropriate statistical methods. Findings The results indicate some interesting phenomenon: the magnitude of earnings management did not decline after the governance reform as a positive time trend is observed in the entire sample as well as in Australian and New Zealand sub-samples, suggesting that earnings management has been growing over time. Additional test indicates no structural change has occurred before and after the new regulations. The shifting from decreasing earnings management to increasing earnings management can be interpreted as an evidence that earnings become more ‘informative’ in a more transparent disclosure regime to capture short-run benefits from regulator reforms. Research limitations/implications The shifting of earnings management behaviour from decreasing to increasing income can be interpreted as the outcome of more “informative”, rather than “deliberate”, earnings management in a more transparent disclosure regime to capture short-run benefits of regulatory reforms, which is worth further investigation. The findings of the study can lead regulatory authorities taking appropriate measures to promote earnings quality in corporate financial reporting from a long-run decision usefulness context. Any future reforms should be directed to protecting the interest of stakeholders as well as ensuring benefits outweighing costs for them. Practical implications The findings of the study can lead regulatory authorities in taking appropriate measures to promote earnings quality in corporate financial reporting from a long-run decision usefulness context. Originality/value The study adds value to the existing earnings management literature as well as effectiveness of regulations for the benefit of wider stakeholder groups.

There is a widely application of panel data estimation in accounting and finance research. The approach is well accepted, because the pooled panel data provide rich information as compared to either cross-sections or time series data structure. However, within panel data structure, variables of interest are often cross-sectionally and serially correlated and as a result, OLS standard errors would be biased when panel data are used in the regression analysis. Several techniques, for example firm dummy variables, one-way cluster-robust standard errors, Fama-MacBeth procedure, and Newey-West procedure, are documented as a solution in analyzing panel data. These techniques to some extent correct either cross-sectional correlation or serial correlation. None is designed to deal with correlations in two dimensions (across firms and across time). With panel data structure, correlations are more likely to appear in two dimensions with both firm effects and time effects. This study suggests that two-way cluster-robust standard errors approach can correct both cross-sectional correlation and serial correlation and therefore should be considered as a better alternative in handling panel data. Nonetheless, two-way cluster-robust standard errors approach could be biased when applying to a finite sample. This study uses a real data set and constructs an empirical application of the estimation procedures of two-way cluster-robust regression estimation with and without finite-sample adjustment and the results show that finite-sample adjusted estimates are superior to unadjusted asymptotic estimates.

The purpose of this article is to provide a review of the impact of the COVID-19 pandemic on Australian household finances and understand how the pandemic has had significant repercussions for household finances and behaviours toward saving and spending goals. Based on a national survey conducted by the Australian Bureau of Statistics in December 2020, we report that financial shocks continued to hit low-income households and one-parent families with dependent children the hardest. The lowest-income households had to forfeit a week’s worth of income on a less expensive shock but three times their weekly income to absorb a more expensive shock. The low-income households and one parent family with dependent children did well in following a budget, however, they were in a weak position when considering the ability to save regularly. The overall households also had a low rate of seeking financial information, counselling or advice from a professional. These findings will have implications for the policymakers and advisors who assist households in sustaining their finances and well-being.

PurposeThis study is primarily motivated by the increasing concern of the academic, practitioners, regulators and standard setters regarding the quality of earnings and financial reporting. The purpose is to investigate whether the accrual anomaly exists in Australia; whether the occurrence of the accrual anomaly is attributed to the discretionary accruals component stemming from managerial discretion; and the impact of corporate governance reforms on accrual mispricing.Design/methodology/approachThis study employs the Mishkin (1983) rational expectations test to examine whether the earnings expectations embedded in stock prices accurately reflect the differential persistence of earnings components. It also employs the hedge portfolio trading strategy to examine whether taking a long position in firms with low accruals and a short position in firms with high accruals will yield positive abnormal stock returns.FindingsThe results show that investors overestimate the persistence of accruals and underestimate the persistence of cash flows and subsequently, overprice the accruals and underprice the cash flows. The evidence of accrual mispricing is severe for the component of discretionary accruals. Nonetheless, the association between discretionary accruals and abnormal returns are weakened during the corporate governance reforms period.Research limitations/implicationsIt should be cautious to attribute the investors' ability to accurately price accruals and cash flows to the passage of corporate governance reform program. Despite there is control for firm size, book-to-market, PE multiple, growth and leverage, other macro-economic factors such as interest rates, inflation and GDP could potentially have an impact on stock returns.Practical implicationsThe passage of corporate governance reform program has increased the level of financial reporting disclosure and the monitoring of management, which subsequently improved accruals persistence and earnings quality. A direct practical implication is that investors should better understand the information in accruals for future earnings when the corporate disclosure environment is strengthened.Social implicationsThis study provides useful information to regulators, academics and investors interested in market efficiency and accrual mispricing. The results suggest that the reform of corporate governance is associated with more efficient prices. This may be of interest to the regulators who intend to improve earnings quality and financial reporting environment through the regulatory reform.Originality/valueTo test the accrual anomaly in the period of corporate governance reforms is particularly useful to regulators and policy makers. It allows regulators and policy makers to gain insight as whether the change of regulation has been effective – more transparent and timely reporting of financial information are supposed to help the investors to better understand the accruals and thus mitigate the potential for accrual mispricing.