Ownership Concentration, Debt Financing and the Investment Opportunity Set as Determinants of Accounting Discretion: Empirical Evidence From Spain

Azofra, Valentı́n; Castrillo, Luis A.; Delgado, María del Mar

doi:10.1080/02102412.2003.10779480

Cited by 23 publications

(20 citation statements)

References 42 publications

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“…These results pointing to Spain as a country possessing the determinants for accumulating more practices involving earnings manipulation are confirmed in other works (Azofra et al 2003;La Porta et al 1998;Coppens & Peek 2005).…”

Section: Models Predicting Accounting Manipulationsupporting

confidence: 78%

Accounting ratio-based predictions: an analysis of the relationship between indicators of financial health and those of accounting manipulation

Llobet-Dalmases¹,

Plana-Erta²,

Fitó³

2017

Eur. Account. Manag. Rev.

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Against a backdrop of global accounting harmonization, financial information is required to be useful and trustworthy for investors and other users. This study contributes to establishing whether there is a relationship between the Z-score model for predicting financial distress and the Z Vladu model for predicting earnings manipulation. Both models discriminate between companies using financial statement ratios. The results show that there is a relationship between both indicators, albeit a weak one. Extracting data from the Sistema de Análisis de Balances Ibéricos (Iberian AccountsAnalysis

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Section: Models Predicting Accounting Manipulationsupporting

confidence: 78%

Accounting ratio-based predictions: an analysis of the relationship between indicators of financial health and those of accounting manipulation

Llobet-Dalmases¹,

Plana-Erta²,

Fitó³

2017

Eur. Account. Manag. Rev.

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“…Although less pronounced than in the United States, Arnedo et al (2007) point out that there is enough market pressure in Spain for earnings management to be used as a tool to improve the firm's image. Some papers on Spanish listed firms suggest that they may have incentives to increase earnings (Azofra et al, 2003;Gallén and Giner, 2005) in response to increased market pressure.…”

Section: Accounting Manipulation and The Role Of Debt-holders In Spainmentioning

confidence: 98%

Debt, diversification and earnings management

Pérez

Hemmen

2010

Journal of Accounting and Public Policy

111

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“…Consequently, managers would have fewer incentives to manage earnings in the most leveraged firms. In spite of this, there is also empirical evidence which documents a positive relation between financial leverage and earnings management (Azofra et al, 2002). These authors show that the impression made by financial statements can be useful to loose restrictive loan convenants and to raise funds in better conditions so that managers have incentives to manipulate earnings (Mohrman, 1996).…”

Section: Managers' Discretionary Behaviour Earnings Management Corpmentioning

confidence: 99%

Earnings management and internal mechanisms of corporate governance: Empirical evidence from Chilean firms

López‐Iturriaga¹,

Saona²

2005

COC

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We analyze the ability of the capital structure and the ownership structure as mechanisms of control of the managers of the firms and to reduce their accounting discretionary power for a sample of Chilean firms. Using earnings management and abnormal accruals as indicators of discretionary behavior, our results show that both debt and ownership concentration reduce the managers' discretionary behavior, so we corroborate the outstanding role both mechanisms play in a country with low protection of investors' rights. At the same time, we find that earnings management is fostered by institutional investor ownership.

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Ownership Concentration, Debt Financing and the Investment Opportunity Set as Determinants of Accounting Discretion: Empirical Evidence From Spain

Cited by 23 publications

References 42 publications

Accounting ratio-based predictions: an analysis of the relationship between indicators of financial health and those of accounting manipulation

Accounting ratio-based predictions: an analysis of the relationship between indicators of financial health and those of accounting manipulation

Debt, diversification and earnings management

Earnings management and internal mechanisms of corporate governance: Empirical evidence from Chilean firms

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