Do Board Secretaries Influence Management Earnings Forecasts?

Lu, Xing; Duan, Tinghua; Hou, Wenxuan

doi:10.1007/s10551-017-3478-6

Cited by 34 publications

(54 citation statements)

References 67 publications

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“…It appears through the findings that IPO firms with separate CEO and chairman positions are not expected to issue accurate earnings forecasts, in that the agency theory's argument of separation of responsibilities is not supported. This is consistent with the result provided by Xing et al (2019), which revealed that board secretaries with dual roles are more capable of accessing information and resources, which ultimately results in providing high-quality management earnings forecasts. Table 3 also shows that management ownership (MOWN) has a negative and insignificant relationship with AFER, in that the higher the management ownership, the lower will be the earnings forecast error.…”

Section: Multivariate Regression Analysissupporting

confidence: 90%

The Impact of the Board of Directors Characteristics on the Risk of IPO Earnings Forecasts Errors

Alsahlawi¹,

Ammer²

2019

ASS

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This paper aimed to investigate the effect of corporate governance mechanism on the risk of IPO earnings forecasts errors. It focuses on the relationship between the board of directors characteristics and the risk of earnings forecasts errors. Required data was gathered from 190 Malaysian IPO prospectuses for the year 2002 to 2012, after which data was analyzed using ordinary least squares (OLS) regression. Based on the obtained findings, the earnings forecasts of Malaysian IPO reflected a pessimistic picture with unsatisfactory percentage of accuracy. In particular, the findings of multiple regression analysis of the relationships between the size, independence and CEO duality of the board of directors, and the risk of earnings forecasts errors were negative and insignificant. The study findings have several implications for relevant individuals, including regulators, investors, financial analysts and financial statements users.In the same line of argument, errors in earnings forecasts have a likelihood of mitigating the reported earnings quality, their value upon which investment decisions are made and the investor confidence on the financial reports. But management earnings forecasts that are controlled through monitoring systems generate more reliable and quality earnings forecasts. More specifically, as internal corporate governance mechanisms, board of directors are in a good position to take on an effective monitoring role of keeping the management interests consistent with those of shareholders, lessening the opportunistic behavior of the former and in effect, improving the quality of the IPO earnings forecasts.The present study has theoretical and practical contributions in the several ways. The first contribution relates to the increasing recognition of the management earnings forecasts relevance as evidenced by their inclusion in the IPO companies prospectuses -however, studies addressing them are still few and far between (Gounopoulos, ass.ccsenet.org Asian Social Science Vol. 15, No. 11 2019

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Section: Multivariate Regression Analysissupporting

confidence: 90%

The Impact of the Board of Directors Characteristics on the Risk of IPO Earnings Forecasts Errors

Alsahlawi¹,

Ammer²

2019

ASS

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show abstract

“…To date, empirical studies related to company secretaries are set in China. However, Xing et al (2019) explain that board secretaries in China differ greatly from company secretaries in Western countries. Board secretaries are required by law to be present in top management teams in China and have a unique responsibility for coordinating information disclosure.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

“…While the literature on role of corporate governance is voluminous, the literature on the role of company secretaries is relatively descriptive or qualitative, given that we know that company secretaries perform an important role (Hocken and Latimer, 2006;Robertson, 2018). Studies find evidence on the various roles of company secretaries (Peij et al, 2015;Kakabadse et al, 2016;Xing et al, 2019;Wang et al, 2019); however, there is little empirical evidence on how the various roles are related to board and firm outcomes. Xing et al (2019) examine firms in China and note that company secretaries' expertise is related to the quality of management forecasts made by the firm, whereas Wang et al (2019) examine the effect of Chinese company secretaries' tenure on firm outcomes.…”

Section: Introductionmentioning

confidence: 99%

“…Studies find evidence on the various roles of company secretaries (Peij et al, 2015;Kakabadse et al, 2016;Xing et al, 2019;Wang et al, 2019); however, there is little empirical evidence on how the various roles are related to board and firm outcomes. Xing et al (2019) examine firms in China and note that company secretaries' expertise is related to the quality of management forecasts made by the firm, whereas Wang et al (2019) examine the effect of Chinese company secretaries' tenure on firm outcomes. While this provides some insight into the role of the company secretary, Xing et al (2019) explain that the roles of the company secretary in China differ greatly from that in Western countries.…”

Section: Introductionmentioning

confidence: 99%

“…Xing et al (2019) examine firms in China and note that company secretaries' expertise is related to the quality of management forecasts made by the firm, whereas Wang et al (2019) examine the effect of Chinese company secretaries' tenure on firm outcomes. While this provides some insight into the role of the company secretary, Xing et al (2019) explain that the roles of the company secretary in China differ greatly from that in Western countries. Thus, there is still a gap in our knowledge of how the roles of the company secretary relate to corporate governance practices.…”

Section: Introductionmentioning

confidence: 99%

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The role of the company secretary in facilitating board effectiveness: reporting and compliance

Nowland

Chapple

Johnston

2020

Accounting & Finance

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This study investigates how company secretaries (CS) influence board practices and financial reporting. All public companies have a secretary and this position may be combined with Chief Financial Officer (CFO) or legal counsel. Examining the period 2004-2015, we find that joint CS/CFOs hold more audit committee meetings, are associated with less earnings management and a greater likelihood of a clean audit opinion. Companies with joint CS/legal counsels are more timely filers and company secretaries of multiple companies schedule fewer committee meetings. These results indicate that company secretaries significantly influence board practices and financial reporting, depending on their role and busyness.

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Is corporate social responsibility constrained by bank credit resource allocation?

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Credit rationing theory suggests that the impact of bank credit allocation on corporate social responsibility (CSR) has the dual effect of adverse selection and moral hazard. In this study, the impact of credit allocation on CSR and its mechanisms are explored in the context of credit rationing theory based on Chinese listed companies from 2010 to 2019. The results show that the impact of bank credit allocation on CSR exhibits an inverted U-shaped correlation, and there is a critical point (17.9134) at which the increase in credit allocation will promote the level of CSR until the critical point is exceeded, after which the level of CSR will gradually decrease. Credit allocation can influence CSR through information asymmetry (stock price informativeness, analyst tracking) and managerial overconfidence, respectively. Companies with overconfident managers and low transparency in non-socially responsible weighting systems are more likely to have an inverted U-shaped relationship between bank credit allocation and CSR. This study provides new empirical evidence to understand the impact of credit allocation on CSR and expands the theory of credit rationing to a certain extent, thereby providing a reference for CSR maximization.

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Do Board Secretaries Influence Management Earnings Forecasts?

Cited by 34 publications

References 67 publications

The Impact of the Board of Directors Characteristics on the Risk of IPO Earnings Forecasts Errors

The Impact of the Board of Directors Characteristics on the Risk of IPO Earnings Forecasts Errors

The role of the company secretary in facilitating board effectiveness: reporting and compliance

Is corporate social responsibility constrained by bank credit resource allocation?

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