Accounting conservatism and firm performance during the COVID‐19 pandemic

Cui, Li; Kent, P. W.; Kim, Sujin; Li, Shan

doi:10.1111/acfi.12767

Cited by 48 publications

(40 citation statements)

References 95 publications

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“…Many companies are experiencing disastrous financial and business performance, supply chain disruption and other issues, a consequence of snap lockdowns and harsh travel restrictions (Donthu & Gustafsson, 2020). Following the arrival of the pandemic, companies have significantly changed their disclosure practices (Cui et al, 2021;Humphreys & Trotman, 2021). This is due to the role played by managerial perceptions regarding the provision of accounting information which includes both financial and non-financial information (Humphreys & Trotman, 2021).…”

Section: Introductionmentioning

confidence: 99%

COVID-19 and CSR disclosure: evidence from New Zealand

Bahadar

Zaman

2022

CAFR

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PurposeStakeholders' uncertainty about firms' value drives their urge to get information, as well as managerial disclosure choices. In this study, the authors examine whether and how an important source of uncertainty – the recent COVID-19 pandemic's effect on corporate social responsibility (CSR) disclosure – is beyond managerial and stakeholders' control.Design/methodology/approachThe authors develop a novel construct for daily CSR disclosure by employing computer-aided text analysis (CATA) on the press releases issued by 125 New Zealand Stock Exchange (NZX) listed from 28 February 2020 to 31 December 2020. To capture COVID-19 intensity, the authors use the growth rate of the population-adjusted cumulative sum of confirmed cases in New Zealand on a specific day. To examine the association between the COVID-19 outbreak and companies' CSR disclosure, the authors employed ordinary least squares (OLS) regression by clustering standard error at the firm level.FindingsThe authors find a one standard deviation increase in the COVID-19 outbreak leads to a 28% increase in such disclosures. These results remained robust to a series of sensitivity tests and continue to hold after accounting for potential endogeneity concerns. In the channel analysis, the study demonstrates that the positive relationship between COVID-19 and CSR disclosure is more pronounced in the presence of a well-structured board (i.e. a large, more independent board and with a higher proportion of women on it). In further analysis, the authors find the documented relationship varies over the pandemic's life cycle and is moderated by government stringency response, peer CSR pressure and media coverage.Originality/valueThis paper is the first study that contributes to the scant literature examining the impact of the COVID-19 outbreak on CSR disclosure. Prior research either investigates the relationship of the CSR-stock return during the COVID-19 market crisis or examines the relationship between corporate characteristics including the quality of financial information and the reactions of stock returns during COVID-19. The authors extend such studies by providing empirical evidence that managers respond to COVID-19 by increasing CSR disclosure.

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Section: Introductionmentioning

confidence: 99%

COVID-19 and CSR disclosure: evidence from New Zealand

Bahadar

Zaman

2022

CAFR

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“…The findings from the survey concur with findings from the previous studies. The study conducted by Cui et al (2021) show that accounting and financial measures are key tools to the survival of the business in the post COVID-19 Pandemic environment.…”

Section: Discussion Of Findingsmentioning

confidence: 99%

Analysis of Finance and Accounting Measures to Mitigate the Impact of COVID-19 Pandemic among Businesses in Rwanda during and in a Post COVID Environment

Twesige¹

2022

OJAcct

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Introduction: COVID-19 pandemic has not affected the health system of the country; it has had a very big impact on the business operations. COVID-19 measures such as social distancing and lockdowns have had a huge impact on the business operation across the world. Many businesses have closed their doors and others are on the brink of closing. This study analyzes the finance and accounting to adopt to mitigate the impact of COVID-19 pandemic on the business. Material and Methods: The study adopted a quantitative approach. The study population comprised of professional 256 accountants working in different sectors. Data was collected from primary sources using a questionnaire that was emailed to respondents. Descriptive and inferential statistics were used to analyze the data. Results: The findings indicated various accounting and finance measures such as frequent assessment of the going concern and fair values of the assets, frequent preparation of financial reports, adopting a zero based budgeting and activity based costing, proper management of cash flows, re-visiting the capital investment plan, risk management and the management of the cash conversion cycle should be practiced by accountants and financial managers. The results further revealed a relationship between finance and accounting measures and business survival during and in the post COVID-19 pandemic environments. Originality: The study contributed to the existing literatures by indicating the accounting and financial measures that should be practiced by accountants and financial managers to mitigate the impact of COVID-19 pandemic during and in the post COVID environment.

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“…The current study provides practical evidence from the reality of the Egyptian business environment as an economy arising, about the impact of adopting IFRS on the relationship between accounting conservatism and the cost of capital, which contributes to narrowing the research gap in this field. Bushman & Piotroski, 2006;Li (2015); Fu & Liu (2017); Razzaq & Rui (2018); Ibrahim et al (2019); Penman & Zhang (2020); Latif et al, (2020); Cui et al, (2021); Krismiaji (2021); Krismiaji (2021)…”

Section: Originality and Valuementioning

confidence: 99%

أثر تبنی المعاییر الدولیة للتقریر المالى (Ifrs) على العلاقة بین التحفظ المحاسبی وتکلفة رأس المال: دراسة تطبیقیة على الشرکات المقیدة بالبورصة المصریة

الوکیل¹

2022

المجلة العلمیة للدراسات المحاسبیة

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Accounting conservatism and firm performance during the COVID‐19 pandemic

Cited by 48 publications

References 95 publications

COVID-19 and CSR disclosure: evidence from New Zealand

COVID-19 and CSR disclosure: evidence from New Zealand

Analysis of Finance and Accounting Measures to Mitigate the Impact of COVID-19 Pandemic among Businesses in Rwanda during and in a Post COVID Environment

أثر تبنی المعاییر الدولیة للتقریر المالى (Ifrs) على العلاقة بین التحفظ المحاسبی وتکلفة رأس المال: دراسة تطبیقیة على الشرکات المقیدة بالبورصة المصریة

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