International diversification, ownership structure, legal origin, and earnings management: Evidence from Taiwan

Journal of Accounting, Auditing and Finance

Volumn 24, Issue 2, 2009, Pages 233-262

  Chin, Chen Lung ^a   Chen, Yu Ju ^b   Hsieh, Tsun Jui ^b  

^a NATIONAL CHENGCHI UNIVERSITY   (Taiwan)

^b PROVIDENCE UNIVERSITY   (Taiwan)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 67649547388     PISSN: 0148558X     EISSN: None     Source Type: Journal    
DOI: 10.1177/0148558X0902400205     Document Type: Article

References (82)

1. Ashbaugh, H., R. LaFond, and B. Mayhew. 2003. "Do Non-Audit Services Compromise Auditor Independence? Further Evidence." The Accounting Review 78 (July): 611-639.
2. Ball, R., A. Robin, and J. Wu. 2003. "Incentives versus Standards: Properties of Accounting Income in Four East Asian Countries." Journal of Accounting and Economics 36 (1-3): 235-270.
3. Ball, R., S. Kothari, and A. Robin. 2000. "The Effect of International Institutional Factors on Properties of Accounting Earnings." Journal of Accounting and Economics 29: 1-52.
4. Barth, M., J. Elliot, and M. Finn. 1999. "Market Rewards Associated with Patterns of Earnings Increases." Journal of Accounting Research 37 (Autumn): 387-424.
5. Beatty, A., and D. G. Harris. 1999. "The Effects of Taxes, Agency Costs and Information Asymmetry on Earnings Management: A Comparison of Public and Private Firms." Review of Accounting Studies 4 (3/4): 299-326.
6. Becker, C. L., M. L. DeFond, J. Jiambalvo, and K. R. Subramanyam. 1998. "The Effect of Audit Quality on Earnings Management." Contemporary Accounting Research 15: 1-26
7. Belsley, D. A., E. Kuh, and R. E. Welsch. 1980. Regression Diagnostics. New York: John Wiley and Sons.
8. Berenson, A. 2003. "The Number: How the Drive for Quarterly Earnings Corrupted Wall Street and Corporate America." New York: Random House.
9. Boatsman, J. R., B. K. Behn, and D. H. Patz. 1993. "A Test of the Use of Geographical Segment Disclosures." Journal of Accounting Research (Supplement): 46-64.
10. Bodnar, G. M., and J. Weintrop. 1997. "The Valuation of Foreign Earnings: A Growth Opportunities Perspective." Journal of Accounting and Economics 24: 69-97.
11. Bodnar, G. M., C. Tang, and J. Weintrop. 1999. "Both Sides of Corporate Diversification: The Value Impacts of Geographical and Industrial Diversification. " Working paper, University of Pennsylvania, Philadelphia.
12. Bodnar, G. M., L. S. Hwang, and J. Weintrop. 2003. "The Value Relevance of Foreign Income: An Australian, Canadian, and British Comparison. " Journal of International Financial Management and Accounting 14 (3): 171-193.
13. Callen, J., O.-K. Hope, and D. Segal. 2005. "Domestic and Foreign Earnings, Stock Return Variability and the Impact of Investor Sophistication. " Journal of Accounting Research 43 (3): 377-412.
14. Chang, S. C. 2007. "The Interactions among Foreign Direct Investments, Economic Growth, Degree of Openness and Unemployment in Taiwan. " Applied Economics 39: 1647-1666.
15. Chin, C., G. Kleinman, P. Lee, and M. Lin. 2006. "Corporate Ownership Structure and Accuracy and Bias of Mandatory Earnings Forecast: Evidence from Taiwan. " Journal of International Accounting Research 5 (2): 41-62.
16. Claessens, S., S. Djankov, and L. H. P. Lang. 2000. "The Separation of Ownership and Control in East Asian Corporation. " Journal of Financial Economics 58: 81-112.
17. Coffee, J. C. 1999. "The Future as History: The Prospects for Global Convergence in Corporate Governance and Its Implications." Northwestern University Law Review 93: 641-708.
18. -. 2002. "Racing towards the Top? The Impact of Cross-Listings and Stock Market Competition on International Corporate Governance." Columbia Law Review 102: 1757-1831.
19. Cook, D., and S. Taub. 2007. "U. S. GAAP: Riding Off into the Sunset?" April 25, 2007. http://www.cfo.com/article.cfm/9070156?f=alerts.
20. DeAngelo, H. L., L. DeAngelo, and D. J. Skinner. 1994. "Accounting Choice in Troubled Companies." Journal of Accounting and Economics 17: 113-144.
21. Dechow, P. M., R. G. Sloan, and A. P. Sweeney. 1995. "Detecting Earnings Management." The Accounting Review 70: 193-225.
22. -. 1996. "Causes and Consequences of Earnings Manipulation: An Analysis of Firms Subject to Enforcement Actions by the SEC." Contemporary Accounting Research (Spring): 1-36.
23. DeFond, M., and J. Jiambalvo. 1994. "Debt Covenant Violation and Manipulation of Accruals." Journal of Accounting and Economics (January): 145-176.
24. Degeorge, F., J. Patel, and R. Zeckhauser. 1999. "Earnings Management to Exceed Thresholds." Journal of Business 72 (1): 1-33.
25. Delios, A., and P. W. Beamish. 1999. "Geographic, Scope, Product Diversification, and the Corporate Performance of Japanese Firms." Strategic Management Journal 20 (8): 711-727.
26. Doidge C., G. A. Karolyi, and R. M. Stulz. 2004. "Why Are Foreign Firms Listed in the U. S. Worth More?" Journal of Financial Economics 71: 205-238.
27. Duru A., and D. M. Reeb. 2002. "International Diversification and Analysts' Forecast Accuracy and Bias." The Accounting Review 77 (2): 415-434.
28. Dye, R. 1988. "Earnings Management in an Overlapping Generations Model." Journal of Accounting Research 26: 195-235.
29. Fan, J. P. H., and T. J. Wong. 2002. "Corporate Ownership Structure and the Informativeness of Accounting Earnings in East Asia." Journal of Accounting and Economics 33: 401-425.
30. Foerster S., and G. A. Karolyi. 1999. "The Effects of Market Segmentation and Investor Recognition on Asset Prices: Evidence from Foreign Stocks Listing in the U. S." Journal of Finance 54:981-1014.
31. Francis, J., K. Schipper, and L. Vincent. 2005. "Earnings and Dividend Informativeness When Cash Flow Rights Are Separated from Voting Rights." Journal of Accounting and Economics 39: 329-360.
32. Francis, J. R., K. Reichelt, and D. Wang. 2006. "National versus Office-Specific Measures of Auditor Industry Expertise and Effects on Client Earnings Quality." Working paper, University of Missouri.
33. Frankel, R., M. Johnson, and K. Nelson. 2002. "The Relation between Auditors' Fees for Nonaudit Services and Earnings Management." The Accounting Review 77 (Supplement): 71-105.
34. Greene, W. H. 2000, Econometric Analysis, 4th ed. Beverly Hills, CA: Sage Publications.
35. Hail, L., and C. Leuz. 2004. "Cost of Capital and Cash Flow Effects of U. S. Cross-Listings." Working paper, University of Pennsylvania.
36. Haw, I. M., B. B. Hu, L. S. Hwang, and W. Wu. 2004. "Ultimate Ownership, Income Management, and Legal and Extra-Legal Institutions." Journal of Accounting Research 42: 423-426.
37. Healy, P. 1985. "The Effect of Bonus Schemes on Accounting Decisions." Journal of Accounting and Economics 7 (4): 85-107.
38. Herrmann, D., O.-K. Hope, and W. B. Thomas. 2008. "International Diversification and Forecast Optimism: The Effects of Reg FD." Accounting Horizons. Forthcoming.
39. Hope, O.-K. 2003. "Disclosure Practices, Enforcement of Accounting Standards, and Analysts' Forecast Accuracy: An International Study." Journal of Accounting Research 41 (2): 235-272.
40. Hope, O.-K., and W. B. Thomas. 2008. "Managerial Empire Building and Firm Disclosure." Journal of Accounting Research. Forthcoming.
41. Hope, O.-K., T. Kang, W. B. Thomas, and F. Vasvari. 2008. "The Effects of SFAS 131 Geographic Segment Disclosure by U. S. Multinational Companies on the Valuation of Foreign Earnings." Journal of International Business Studies. Forthcoming.
42. Hung, M. 2001. "Accounting Standards and Value Relevance of Financial Statements: An International Analysis." Journal of Accounting and Economics 30: 401-420.
43. Jensen, M. C., and W. H. Meckling. 1976. "Theory of the Firm: Managerial Behavior, Agency Cost and Ownership Structure." Journal of Financial Economics 3: 305-360.
44. Johnson, S. 2007. "One Accounting Standard for All?" April 27, 2007. http://www.cfo.com/article. cfm/8810355?f=related.
45. Kennedy, P. 1992. A Guide to Econometrics. Cambridge, MA: MIT Press.
46. Khanna, X., K. G. Palepu, and J. J. Chang. 2000. "Analysts Activity around the World." Working paper, Harvard University.
47. Khurana, I., H. Pereira, and K. Raman. 2003. "Does Analyst Behavior Explain Market Mispricing of Foreign Earnings for U. S. Multinational Firms?" Journal of Accounting, Auditing and Finance 18 (Fall): 453-478.
48. Klein, A. 2002. "Audit Committee, Board of Director Characteristics, and Earnings Management." Journal of Accounting and Economics 33: 375-400.
49. Kogut, B. 1983. "Foreign Direct Investment as a Sequential Process." In The Multinational Corporations in the 1980s, ed. C. Kindelberger. Cambridge, MA: MIT Press.
50. Kothari, S., A. Leone, and C. Wasley. 2005. "Performance Matched Discretionary Accrual Measure." The Journal of Accounting and Economics. 39 (1): 163-197.
51. La Porta, R., F. Lopez-de-Silanes, and A. Shleifer. 1999. "Corporate Ownership around the World." Journal of Finance 54: 471-517.
52. La Porta, R., F. Lopez-de-Silanes, A. Shleifer, and R. Vishny. 1997. "Legal Determinants of External Finance." Journal of Finance 52 (3): 1131-1150.
53. -. 1998. Law and Finance." Journal of Political Economy 106: 1113-1155.
54. -. 2000. "Investor Protection and Corporate Governance." Journal of Financial Economics 58: 3-27.
55. Lang, M. H., K. V. Lins, and D. P. Miller. 2003. "Adrs, Analysts, and Accuracy: Does Cross-Listing in the U. S. Improve a Firm's Information Environment and Increase Market Value?" Journal of Accounting Research 41: 317-345.
56. Lee, T. S., and Y. H. Yeh. 2004. "Corporate Governance and Finance Distress: Evidence from Taiwan. " Corporate Governance: An International Review 12: 378-388.
57. Leuz, C., D. Nanda, and P. Wysocki. 2003. "Earnings Management and Institutional Factors: An International Comparison. " Journal of Financial Economics 69 (3): 505-527.
58. Lins, K., D. Strickland, and M. Zenner. 2005. "Do Non-U. S. Firms Issue Equity on U. S. Exchanges to Relax Capital Constraints?" Journal of Financial and Quantitative Analysis 40: 109-133.
59. Meek, G., and W. Thomas. 2004. "A Review of Market-Based International Accounting Research." Journal of International Accounting Research (1): 21-41.
60. Menon, G., and D. Williams. 2004. "Former Audit Partners and Abnormal Accruals." The Accounting Review 79: 1095-1118.
61. Morck, R., and B. Yeung. 1991. "Why Investors Value Multinationality." Journal of Business 64 (2): 165-187.
62. Myers, J. N., Myers, L. A., and T. C. Omer. 2003. "Exploring the Term of the Auditor-Client Relationship and the Quality of Earnings: A Case for Mandatory Auditor Rotation?" The Accounting Review 78: 799.
63. Reynolds, J. K., and J. Francis. 2001. "Does Size Matter? The Influence of Large Clients on Office Level Auditor Reporting Decisions." Journal of Accounting and Economics 30 (12): 375-400.
64. Richardson, V. J. 2000. "Information Asymmetry and Earnings Management: Some Evidence." Review of Quantitative Finance and Accounting 15: 325-347.
65. Sambharya, R. B. 1995. "The Combined Effect of International Diversification and Product Diversification Strategies on the Performance of U. S.-Based Multinational Corporations." Management International Review 35 (3): 197-218.
66. Schipper, K. 1989. "Earnings Management." Accounting Horizons 3: 91-106.
67. Shleifer, A., and R. Vishny. 1997. "A Survey of Corporate Governance." Journal of Financial Economics 53: 737-783.
68. Skinner, D., and R. Sloan. 2002. "Earnings Surprises, Growth Expectations, and Stock Returns, or Don't Let an Earning Torpedo Sink Your Portfolio." Review of Accounting Studies 7 (6): 289-312.
69. Sloan, R. 1996. "Do Stock Prices Fully Reflect Information in Accruals and Cash Flows about Future Earnings?" The Accounting Review (July): 289-315.
70. Stulz, R. 1990. "Managerial Discretion and Optimal Financing Policies." Journal of Financial Economics 26: 3-27.
71. Sullivan D., 1994. "Measuring the Degree of Internationalization of a Firm." Journal of International Business Studies 25 (2): 325-342.
72. Tallman, S., and J. Li, 1996. "Effects of International Diversity and Product Diversity on the Performance of Multinational Firms." Academy of Management Journal 39 (1): 179-196.
73. Thomas, W. 1999. "A Test of the Market's Mispricing of Domestic and Foreign Earnings." Journal of Accounting and Economics 28: 243-267.
74. -. 2000. "The Value-Relevance of Geographic Segment Earnings Disclosures under SFAS 14." Journal of International Financial Management and Accounting 133-155.
75. Tihanyi, L., and W. Thomas. 2005. "Information-Processing Demands and International Expansion. " Journal of Business Research 58: 285-292.
76. Tihanyi, L., A. E. Ellstrand, C. M. Daily, and D. R Daily. 2000. "Composition of the Top Management Team and Firm International Diversification. " Journal of Management 26 (6): 1157-1177.
77. Trueman, B., and S. Titman. 1988. "An Explanation for Accounting Income Smoothing." Journal of Accounting Research 26: 127-39.
78. Warfield, T. D., J. J. Wild, and K. L. Wild. 1995. "Managerial Ownership, Accounting Choices, and Informativeness of Earnings." Journal of Accounting and Economics 20: 61-91.
79. Watts, R. L., and J. L. Zimmerman. 1978. "Toward a Positive Theory of the Determination of Accounting Standards." The Accounting Review 53: 112-134.
80. -. 1986. Positive Accounting Theory. New York: Prentice-Hall.
81. White, H., 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity." Econometrica 40: 617-636.
82. Yeh, Y. H. 2005. "Do Controlling Shareholders Enhance Corporate Value?" Corporate Governance: An International Review 13 (2): 313-325.