Accounting Quality, Investment Efficiency, and the Country-Level Strength of Institutional Enforcement

2021 ◽  
Author(s):  
Seraina C. Anagnostopoulou
Keyword(s):  
Investment Efficiency ◽  
Accounting Quality ◽  
Country Level ◽  
Quality Investment

Institutional quality, investment efficiency, and the choice of public–private partnerships

2019 ◽  
Vol 60 (2) ◽  
pp. 1801-1834 ◽  
Author(s):  
Nhung Hong Dao ◽  
Vijaya Bhaskar Marisetty ◽  
Jing Shi ◽  
Monica Tan
Keyword(s):  
Institutional Quality ◽  
Public Private Partnerships ◽  
Investment Efficiency ◽  
Quality Investment

Litigation risk, accounting quality, and investment efficiency

2013 ◽  
Vol 29 (2) ◽  
pp. 180-185 ◽  
Author(s):  
Hyeesoo H. Chung ◽  
Jinyoung P. Wynn ◽  
Han Yi
Keyword(s):  
Investment Efficiency ◽  
Litigation Risk ◽  
Accounting Quality

Auditor tenure, investor protection and accounting quality: international evidence

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Khairul Anuar Kamarudin ◽  
Wan Adibah Wan Ismail ◽  
Akmalia M. Ariff
Keyword(s):  
Financial Reporting ◽  
Positive Impact ◽  
Weighted Least Squares ◽  
Investor Protection ◽  
Joint Effect ◽  
Policy Implications ◽  
Accounting Quality ◽  
Content Type ◽  
Country Level ◽  
Auditor Tenure

Purpose This study aims to investigate whether auditor tenure has a significant influence on accounting quality and whether investor protection moderates the effect of auditor tenure on accounting quality. Design/methodology/approach This study uses weighted least squares regression on a sample of 77,855 firm-year observations from 36 countries during the period 2010–2016. This study uses the absolute value of performance-matched discretionary accruals to measure financial reporting quality. Findings This study finds that a longer auditor tenure is associated with higher accounting quality, thus supporting the knowledge effect arguments. The results on the joint effect of investor protection and auditor tenure show evidence of the substitutive effect of investor protection, where the positive impact of auditor tenure on accounting quality is weaker in a high investor-protection environment. Practical implications These findings provide input for policy implications involving the auditing profession. Regulators may need to weigh the costs and benefits of mandatory audit rotation because country-level institutional factors influence auditing regulations and practices, as well as the auditors’ behaviors. Originality/value This study adds to the limited, albeit important, evidence on the joint effect of auditor tenure and country-level governance on accounting quality. The authors respond to the call by Brooks et al. (2017) for more evidence on the role of audits on financial reporting outcomes across various legal institutions for creating effective policies.

scholarly journals Accounting Quality and Firm-Level Capital Investment

2006 ◽  
Vol 81 (5) ◽  
pp. 963-982 ◽  
Author(s):  
Gary C. Biddle ◽  
Gilles Hilary
Keyword(s):  
Information Asymmetry ◽  
Cash Flow ◽  
Capital Investment ◽  
Investment Efficiency ◽  
Accounting Quality ◽  
Control Variables ◽  
Firm Level ◽  
Flow Sensitivity ◽  
Cash Flow Sensitivity

This study examines how accounting quality relates to firm-level capital investment efficiency. Our first hypothesis is that higher quality accounting enhances investment efficiency by reducing information asymmetry between managers and outside suppliers of capital. Our second hypothesis is that this effect should be stronger in economies where financing is largely provided through arm's-length transactions compared with countries where creditors supply more capital. Our results are consistent with these hypotheses both across and within countries. They are robust to alternative econometric specifications, different measures of accounting quality and investment-cash flow sensitivity, and numerous control variables.

Supply chain encroachment with quality decision and different power structures

2020 ◽  
Vol 54 (3) ◽  
pp. 693-718
Author(s):  
Musen Xue ◽  
Jianxiong Zhang
Keyword(s):  
Supply Chain ◽  
Optimal Choice ◽  
Investment Efficiency ◽  
Theoretic Approach ◽  
Direct Channel ◽  
Power Structures ◽  
Game Theoretic ◽  
Quality Investment ◽  
Quality Decision ◽  
Game Theoretic Approach

This paper studies a supply chain with manufacturer encroachment and different power structures where product quality is an endogenous decision. We investigate the effects of encroachment and power structure on quality and profits for chain members. Employing a game-theoretic approach, we find that, first, in a manufacturer-led supply chain, encroachment makes both manufacturer and retailer better off when the quality investment efficiency is relatively high. And, the manufacturer’s profit exhibits nonmonotonicity with respect to the extent of consumers acceptance on the direct channel in a retailer-led setting. Second, our result shows that the pure equilibrium outcomes are driven by the quality investment efficiency and the extent of consumers’ acceptance on the direct channel. An interesting result is that, for the manufacturer, establishing encroachment channel and occupying the leader position simultaneously are always not the optimal choice. Additionally, the options of encroaching and striving for leader position can lead to lose-win, win-win, and win-lose situations for the manufacturer and the retailer. Finally, a prisoner’s dilemma may occur with a low quality investment efficiency, a moderately fixed encroachment cost and a high extent of consumers’ acceptance on the direct channel when a fixed encroachment cost is considered.

Mandatory IFRS Adoption, Accounting Quality, and Investment Efficiency: Evidence from China

2016 ◽  
Vol 4 (3) ◽  
pp. 236-262 ◽  
Author(s):  
Qingchuan Hou ◽  
Qinglu Jin ◽  
Lanfang Wang ◽  
Guochang Zhang
Keyword(s):  
Investment Efficiency ◽  
Accounting Quality ◽  
Ifrs Adoption

scholarly journals The Effect Of Internal Control Weakness On Investment Efficiency

2016 ◽  
Vol 32 (3) ◽  
pp. 649-662 ◽  
Author(s):  
Lee Jaehong ◽  
Cho Eunjung ◽  
Choi Hyunjung
Keyword(s):  
Corporate Governance ◽  
Internal Control ◽  
Investment Decision ◽  
Investment Efficiency ◽  
Accounting System ◽  
Accounting Quality ◽  
Severe Problem ◽  
Internal Accounting Control ◽  
Accounting Control ◽  
Internal Accounting

This paper examines whether material weakness in internal accounting control is negatively associated with investment efficiency in Korea. Since internal accounting control weakness drives poor accounting quality and poor accounting quality exacerbates information asymmetry between firms and outside capital suppliers, managerial investment cannot be monitored effectively which result in over- and/or under- investment. Since internal accounting system is closely related to corporate governance, weak internal accounting control is often associated with poor corporate governance, and this control environment makes it hard to monitor managerial opportunistic behavior, causing abnormal investment such as over- and/or under- investment.  We find that firms with internal accounting control weakness tend to make over- and under- investment. We also find the number of weakness in internal accounting control is negatively related to investment efficiency. In addition, three types of qualified review opinion - overall company level weakness, account-specific weakness and disclaimer review opinion due to scope limitation - are differentially affected to investment efficiency; disclaimer review opinion is present the most severe problem in internal accounting control that drives over- and under- investment. Our findings suggest weak internal accounting control provides poor monitoring to manager and cannot restrain managerial inefficient investment decision. 

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