A Comparison of Regression and Loading Weights for the Computation of Factor Scores

Grice, James W.; Harris, Richard

doi:10.1207/s15327906mbr3302_2

Cited by 90 publications

(86 citation statements)

References 40 publications

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“…However, data on audit committee com position are not available. 5 Following Bertrand and Mullainathan (2001), we use unit weights to create IndGov6 and IndGov8; this is in accordance with the recommendations of Grice and Harris (1998), who show that aggregate measures built using unit weights have better psychometric properties. 6 Therefore, both indexes are based on internal corporate governance mechanisms, basically related to the power or influence of the CEO over the board.…”

Section: Discussionmentioning

confidence: 90%

Board of Directors' Characteristics and Conditional Accounting Conservatism: Spanish Evidence

Lara

Osma

Peñalva

2007

European Accounting Review

138

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Using a sample of Spanish listed firms for the period 1997 2002 we find that firms where the CEO has a low influence over the functioning of the board of directors show a greater degree of accounting conservatism. We measure the influence of the CEO over the board of directors using two aggregate indexes combining six (eight) characteristics of the functioning of the board of directors and its monitoring committees: board size, proportion of non executive directors, proportion of independent directors, whether the chairman of the board is an executive director, the number of board meetings, and the existence of an audit committee, a nomination/remuneration committee and an executive committee. We define conservatism as the asymmetric recognition speed of good and bad news in earnings, and we measure it following Basu (Journal of Accounting and Economics, 24, pp. 3 37, 1997) and Ball and Shivakumar (Journal of Accounting and Economics, 39, pp. 83 128, 2005). Our results are robust to alternative specifications and specific controls for investment opportunities and for the endogenous nature of corporate governance and earnings quality. Overall, our evidence shows that firms with strong boards use conservative accounting numbers as a governance tool, even in an institutional setting with low litigation risk such as Spain.

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Section: Discussionmentioning

confidence: 90%

Board of Directors' Characteristics and Conditional Accounting Conservatism: Spanish Evidence

Lara

Osma

Peñalva

2007

European Accounting Review

138

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“…6 Gompers et al (2003) Grice and Harris (1998), who find that unit-weighted composites exhibit better psychometric properties than alternative weighting schemes.…”

Section: Measurement Of Corporate Governance Qualitymentioning

confidence: 99%

Accounting conservatism and corporate governance

2007

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We predict that firms with stronger corporate governance will exhibit a higher degree of accounting conservatism. Governance level is assessed using a com posite measure that incorporates several internal and external characteristics. Consistent with our prediction, strong governance firms show significantly higher levels of con ditional accounting conservatism. Our tests take into account the endogenous nature of corporate governance, and the results are robust to the use of several measures of conservatism (market based and nonmarket based). Our evidence is consistent with the direction of causality flowing from governance to conservatism, and not vice versa, indicating that governance and conservatism are not substitutes. Finally, we study the impact of earnings discretion on the sensitivity of earnings to bad news across gover nance structures. We find that, on average, strong governance firms appear to use discretionary accruals to inform investors about bad news in a timelier manner.

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“…However, it was decided to simply take the average of the item scores for each factor. The reason for choosing this method for calculating the factor scores was this was what was done in the previous studies of the CRM attitudes of naval aviators, non-refined factor scores are thought to be more stable across samples than refined methods (Grice and Harris, 1998), and this method is desirable when reliability or validity has not been established (Hair, et al, 2006). The MANOVA did not result in any significant differences on any of the factors for aviation community or rank.…”

Section: Between Group Comparisonmentioning

confidence: 99%

An evaluation of the effectiveness of the crew resource management programme in naval aviation

O’Connor

Jones

McCauley

et al. 2012

IJHFE

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Abstract:The US Navy's Crew Resource Management (CRM) training programme has not been evaluated within the last decade. Reactions were evaluated by analysing 51,570 responses to an item pertaining to CRM that is part of a safety climate survey. A total of 172 responses were obtained on a knowledge test. The attitudes of 553 naval aviators were assessed using an attitudes questionnaire. The CRM mishap rate from 1997 until 2007 was evaluated. It was found that naval aviators appear to think than CRM training is useful, are generally knowledgeable of, and display positive attitudes towards, the concepts addressed in the training. However, there is a lack of evidence to support the view that CRM training is having an effect on the mishap rate. As the next generation of highly automated aircraft becomes part of naval aviation, there is a need to ensure that CRM training evolves to meet this new challenge. Report Documentation PageForm Public reporting burden for the collection of information is estimated to average 1 hour per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to Washington Headquarters Services, Directorate for Information Operations and Reports, 1215 Jefferson Davis Highway, Suite 1204, Arlington VA 22202-4302. Respondents should be aware that notwithstanding any other provision of law, no person shall be subject to a penalty for failing to comply with a collection of information if it does not display a currently valid OMB control number. However, there is a lack of evidence to support the view that CRM training is having an effect on the mishap rate. As the next generation of highly automated aircraft becomes part of naval aviation there is a need to ensure that CRM training evolves to meet this new challenge. REPORT DATE

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A Comparison of Regression and Loading Weights for the Computation of Factor Scores

Cited by 90 publications

References 40 publications

Board of Directors' Characteristics and Conditional Accounting Conservatism: Spanish Evidence

Board of Directors' Characteristics and Conditional Accounting Conservatism: Spanish Evidence

Accounting conservatism and corporate governance

An evaluation of the effectiveness of the crew resource management programme in naval aviation

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