Asset Write‐Offs in the Absence of Agency Problems

Garrod, Neil; Kosi, Urska; Valentincic, Aljosa

doi:10.1111/j.1468-5957.2008.02078.x

Cited by 50 publications

(37 citation statements)

References 26 publications

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“…Garrod et al, 2008;Szczesny and Valentincic, 2013). If this is the case, the timing of accounts' publication is likely to be driven by regulatory compliance than by economic demand for the information from outside capital providers.…”

Section: Discussionmentioning

confidence: 99%

“…This is an experimental variable (FINREP), which aims to capture the degree of alignment between financial reporting and taxation. We posit that it is especially apposite for private firms, in that if they are not using accounting for financial reporting, taxation is the most likely alternative (Ball and Shivakumar, 2005;Garrod et al, 2008). In particular, Szczesny and Valentincic (2013) find that German private companies' accounting is driven by tax considerations, and that firms have more time to submit accounting information for tax purposes than for filing accounts -as is the case for UK private companies.…”

Section: Financial Reporting Versus Tax Orientationmentioning

confidence: 99%

“…Rather than for economic motives, such firms may prepare financial statements predominantly for corporate taxation purposes (e.g. Garrod et al, 2008;Szczesny and Valentincic, 2013). If this is the case, the relevance of information for financial reporting to banks, trade creditors and outside shareholders is limited (Ball and Shivakumar, 2005).…”

Section: Introductionmentioning

confidence: 99%

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The timeliness of UK private company financial reporting: Regulatory and economic influences

Clatworthy

Peel

2016

The British Accounting Review

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This paper investigates the extent to which the timeliness of UK private companies' accounting information reflects regulatory and economic influences by studying the impact of a one month shortening of the statutory regulatory filing deadline. Using the financial reporting lag and propensity to file late as measures of timeliness, we find that although reporting behaviour is largely driven by regulatory deadlines, companies conjectured to be producing accounting information for reporting to outside investors publish their accounts significantly more quickly, and are substantially less likely to file beyond the statutory deadline (late), than their counterparts lacking similar incentives. However, in terms of this reporting lag differential, the change in regulation had a homogeneous impact. We report a significant reduction in the mean and median filing time, but an increase of 46% in the proportion of firms filing late, in the year following the regulatory change. Our results are robust to the employment of a number of different estimation methods, including matching and Huber and median regression.

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Section: Discussionmentioning

confidence: 99%

Section: Financial Reporting Versus Tax Orientationmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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The timeliness of UK private company financial reporting: Regulatory and economic influences

Clatworthy

Peel

2016

The British Accounting Review

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“…Consequently, private companies are less likely than public companies to be affected by agency problems between owners and managers and problems between majority and minority shareholders (e.g. Ball & Shivakumar, 2005;Garrod, Kosi, & Valentincic, 2008). Economic incentives for owners and managers are generally closely aligned, because they are often the same persons.…”

Section: Ownership Concentration and Earnings Managementmentioning

confidence: 99%

Do Ownership Structure Characteristics Affect Italian Private Companies’ Propensity to Engage in the Practices of “Earnings Minimization” and “Earnings Change Minimization”?

Poli¹

2015

IJEF

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The study aims to verify whether and how ownership structure (with specific reference to ownership concentration and identity) affects Italian private (unlisted) companies' propensity to engage in practices of "earnings minimization" and "earnings change minimization". Companies that engage in these practices have been identified following the "earnings frequency distribution" approach suggested by Burgstahler and Dichev (1997). The influence of ownership structure, together with that of a set of control variables mainly aiming to control for tax, financial, and size incentives, is tested by logit analysis models. Ownership concentration does not have a statistically significant influence. Conversely, institutional, state, and foreign ownership has a statistically significant influence. In the first and third cases, the influence is negative, in the second case the influence is positive. The study extends the current knowledge on the relationship between aspects of corporate governance and earnings management practices in private companies, especially SMEs. It also expands what is known about the earnings management practices undertaken by companies in countries, like Italy, in which a code law system is in force and accounting and tax systems are closely aligned.

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“…Non-tax costs and benefits also seem to be important drivers of their choices. One of the few studies on a sample of Slovenian SMEs was published by Garrod et al (2008). The work explores economic incentives that drive small private companies operating in Slovenia to record revaluations of current and fixed assets (sample of 23,455 companies).…”

Section: Review Of Research Of Slovenian Smes From the Field Of Finanmentioning

confidence: 99%

Accounting by SMEs – Evidence from Slovenia

Jerman¹

2017

JAMIS

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Abstract:The paper aims to investigate the characteristics of financial reporting and management accounting by Slovenian Small and Medium-sized Entities (SMEs), which represent 99.8% of all Slovene enterprises. The paper examines the most important legal bases for external financial reporting of SMEs, rules in national accounting standards and their close linkage with taxation. The paper highlights how Slovenia adopted the relevant European Union (EU) Directives and emphasizes the particularities of the Slovenian environment that demonstrate diversity at the international level. The paper raises issues concerning lenient requirements on accounting practitioners' qualifications and a lack of supervision of financial statements. We then provide a literature review of relevant studies in the field of financial and management accounting. The financial accounting literature seems to be more developed than that of management accounting. Studies reviewed in this paper mainly focused on the link between financial accounting and taxation, indicating that the use of accounting discretion is motivated by the effort to minimize taxation.

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Asset Write‐Offs in the Absence of Agency Problems

Cited by 50 publications

References 26 publications

The timeliness of UK private company financial reporting: Regulatory and economic influences

The timeliness of UK private company financial reporting: Regulatory and economic influences

Do Ownership Structure Characteristics Affect Italian Private Companies’ Propensity to Engage in the Practices of “Earnings Minimization” and “Earnings Change Minimization”?

Accounting by SMEs – Evidence from Slovenia

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