Accounting Quality in Private Firms during the Transition towards International Standards

Valentincic, Aljosa; Novak, Aleš; Kosi, Urska

doi:10.2139/ssrn.3029161

Cited by 3 publications

(7 citation statements)

References 52 publications

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“…In this paper, we adopt the general convention and view smoothness as an indicator of poor quality (Valentincic et al. ). Hence, we multiply the ratio of standard deviations by −1.…”

Section: Measures Of Earnings Qualitymentioning

confidence: 99%

Earnings Quality and Market Values of Indonesian Listed Firms

Hutagaol‐Martowidjojo

Valentincic

Warganegara

2018

Australian Accounting Review

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We find that earnings quality (EQ) is reliably negatively correlated with the market values of equity of firms listed on the Jakarta Stock Exchange (IDX). The financial reporting process produces earnings viewed as increasingly ‘incomplete’ for valuation purposes by the capital market despite moves towards high‐quality financial reporting standards (IFRS) during the sample period 1995–2015. Time‐series analyses reveal that EQ decreases rather than increases through time. The role of earnings in valuation is replaced by other attributes, most notably net dividends. Firms that pay out dividends are valued significantly higher, and firms that issue equity are valued lower. These results are robust regardless of other accounting, market and governance controls. Large and closely held firms are valued higher than smaller firms, consistent with some aspects of the political cost hypothesis. Shares with higher idiosyncratic risk are valued higher, consistent with option value, as are shares where the volume of shares traded is more volatile. Collectively, the results indicate that the mere adoption of high‐quality accounting standards (IFRS) and other nominal changes in capital market regulations do not automatically increase the quality of the financial reporting process.

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“…In this paper, we adopt the general convention and view smoothness as an indicator of poor quality (Valentincic et al. ). Hence, we multiply the ratio of standard deviations by −1.…”

Section: Measures Of Earnings Qualitymentioning

confidence: 99%

Earnings Quality and Market Values of Indonesian Listed Firms

Hutagaol‐Martowidjojo

Valentincic

Warganegara

2018

Australian Accounting Review

Self Cite

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“…Lungu et al (2017) document that IFRS adoption contributes to an increase in the FDI, which is of interest for the national and regional regulators, as well as for investors and capital markets participants. Valentinčič et al (2017) provide evidence to regulators, companies and users that accounting quality increases with the development and improvement of accounting standards.…”

Section: Policy-relevant Researchmentioning

confidence: 98%

“…Their take is in line with the research question and issues they investigate. Valentinčič et al (2017) investigate the role of national accounting standards development in the accounting quality of private firms in Slovenia. The authors present Slovenia as being representative of the CEE as such:…”

Section: Country-based Studiesmentioning

confidence: 99%

“…While both papers follow research approaches from the international literature (measures for accounting quality and for impression management), they exploit local institutional features and employ unique databases. Valentinčič et al (2017) use data from the Slovenian central database of public legal records, which gives them 'unique access to financial data for all private firms' (p. 359), while Hadro et al (2017) hand-collect and code data from letters to shareholders (written in Polish).…”

Section: Country-based Studiesmentioning

confidence: 99%

“…All three papers conducting a country-case study in this special section (i.e. Alexander & Alon, 2017;Hadro et al, 2017;Valentinčič et al, 2017) follow a longitudinal approach in order to uncover change. Many research questions about the progress of reforming the corporate reporting in CEE countries, in terms of regulations, practices or institutional infrastructure, remain to be addressed by future research, in qualitative or quantitative studies.…”

Section: Country-based Studiesmentioning

confidence: 99%

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Corporate Reporting in Central and Eastern Europe: Issues, Challenges and Research Opportunities

Albu

Filip

2017

Accounting in Europe

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The purpose of this paper, building upon the papers included in this special section of Accounting in Europe on Corporate reporting in CEE countries and on our knowledge of the region, is to broaden out and open up dialogue and debate about how local institutions are evolving and impact the corporate reporting practices in this under-researched region. We begin by discussing the institutional context for conducting research on corporate reporting by entities in Central and Eastern Europe (CEE), within the broader context of emerging, transitional economies. We also reflect on how research conducted on CEE countries can make a relevant contribution to the international literature, and exemplify by summarizing the research questions and findings of the papers included in the special section. A future research agenda emerges, given the gaps in the international literature and the future research implications suggested in the papers constituting the special section.

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Governance in Romania: Exploring the determinants of corporate insider trading

Albu

Hodgson

et al. 2021

Financ Manag Account

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Romania ranks at the extreme low end in Eastern Europe in terms of Hofstede cultural insights, rule of law, government effectiveness, and corruptionpotentially limiting governance quality for restricting resource channeling. In this paper, we examine whether these shortcomings flow over into the degree of corporate insider trading profitability at the firm level. Consistent with high power distance, low individualism, and voice and accountability, executives and their family members extract higher returns. The conjectured monitoring constraint of equity ownership had little impact on reducing profitable trading. Second, media reporting of firm-related scandals only restrained insider profitability in firms with government ownership-consistent with general forbearance of corruption and sanction from the use of politically controlled assets. Third, the global financial crisis revealed both a crisis of inept trading consistent with high uncertainty avoidance and also highly profitable trades for a limited set of executives who undertook short-term reversal strategies. Our exploratory microanalysis suggests a prototype to highlight areas

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Accounting Quality in Private Firms during the Transition towards International Standards

Cited by 3 publications

References 52 publications

Earnings Quality and Market Values of Indonesian Listed Firms

Earnings Quality and Market Values of Indonesian Listed Firms

Corporate Reporting in Central and Eastern Europe: Issues, Challenges and Research Opportunities

Governance in Romania: Exploring the determinants of corporate insider trading

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