Antitakeover Provisions and Discretionary Accruals
0
조회
0
다운로드
4
인용
0
참고문헌
키워드
초록
This paper examines the effects of antitakeover provisions on discretionary accruals. Prior studies indicate that antitakeover provisions are an example of managerial entrenchment. According to this view, antitakeover provisions can be used as a tool to conceal the private benefits of managers. Discretionary accruals are popularly recognized as means to hide the true financial performance of a firm. Thus, we expect that antitakeover provisions would exacerbate discretionary accruals. The alternative hypothesis is that antitakeover provisions are more likely to mitigate discretionary accruals. Managers are more likely to manipulate earnings when they are faced with earnings pressures and the possibility of losing their jobs. Antitakeover provisions help managers create long-term oriented and stable business environments by securing and maintaining the current management. Thus, antitakeover provisions diminish the concerns of managers regarding takeover threats, thereby mitigating their tendency to use discretionary accruals. By examining a sample of 4,720 firm-year observations in the United States from 2007 to 2013, we find that several measurements for antitakeover provisions such as staggered boards and blank check are negatively associated with discretionary accruals. By contrast, golden parachutes, poison pills, and supermajority provisions are positively associated with discretionary accruals. Overall, our study provides evidence that antitakeover provisions play a significant role in determining a firm's discretionary accruals.
Abstract
This paper examines the effects of antitakeover provisions on discretionary accruals. Prior studies indicate that antitakeover provisions are an example of managerial entrenchment. According to this view, antitakeover provisions can be used as a tool to conceal the private benefits of managers. Discretionary accruals are popularly recognized as means to hide the true financial performance of a firm. Thus, we expect that antitakeover provisions would exacerbate discretionary accruals. The alternative hypothesis is that antitakeover provisions are more likely to mitigate discretionary accruals. Managers are more likely to manipulate earnings when they are faced with earnings pressures and the possibility of losing their jobs. Antitakeover provisions help managers create long-term oriented and stable business environments by securing and maintaining the current management. Thus, antitakeover provisions diminish the concerns of managers regarding takeover threats, thereby mitigating their tendency to use discretionary accruals. By examining a sample of 4,720 firm-year observations in the United States from 2007 to 2013, we find that several measurements for antitakeover provisions such as staggered boards and blank check are negatively associated with discretionary accruals. By contrast, golden parachutes, poison pills, and supermajority provisions are positively associated with discretionary accruals. Overall, our study provides evidence that antitakeover provisions play a significant role in determining a firm's discretionary accruals.
참고문헌 (58)
- 김용성, "기업의 지속가능 세부지수와 이익조정의 관련성에 관한 연구", 국제회계연구, (40), pp.39~62 (2011), 한국국제회계학회
- 김정교, "감사품질이 기업의 이익조정에 미치는 영향", 국제회계연구, (38), pp.43~74 (2011), 한국국제회계학회
- "‘포이즌 필’ 도입 주장하는 이유...해외사례는?" (2015), 김혜원[URL]
- 오희화, "분기재무제표에서 기업소유구조와 의무검토 여부가 이익조정에 미치는 영향에 관한 연구", 국제회계연구, (61), pp.191~216 (2015), 한국국제회계학회
- 최학삼, "기업지배구조의 개선이 경영자의 이익조정에 미치는 영향", 국제회계연구, (20), pp.53~73 (2007), 한국국제회계학회
- Agrawal, A., "Large shareholders and the monitoring of managers: The case of antitakeover charter amendments", Journal of Financial and Quantitative Analysis, 25(2), pp.143~161 (1990)
- Akhibe, A., "Impact of anti-takeover amendments on corporate performance", Applied Financial Economics, 6(6), pp.519~529 (1996)
- Armstrong, C., "Corporate governance and the information environment: Evidence from state antitakeover laws", Journal of Accounting and Economics, 53(1-2), pp.185~204 (2012)
- Barnhart, S., "Do firm and state antitakeover provisions affect how well CEOs earn their pay?", Managerial and Decision Economics, 21(8), pp.315~328 (2000)
- Beaver, W., "Discretionary behavior with respect to allowances for loan losses and the behavior of security prices", Journal of Accounting and Economics, 22(1-3), pp.177~206 (1996)
- Beaver, W., "Financial reporting, supplemental disclosures, and bank share prices", Journal of Accounting Research, 27(2), pp.157~178 (1989)
- Bebchuk, L., "The costs of entrenched boards", Journal of Financial Economics, 78(2), pp.409~433 (2005)
- Bebchuk, L., "Pay without performance: The unfulfilled promise of executive compensation" (2004), Harvard University Press
- Bhojraj, S., "Capital market pressure, disclosure frequency-induced earnings", cash flow conflict, and managerial myopia, 2005, pp.80(1), 1~20
- Borokhovich, K., "CEO contracting and antitakeover amendments", Journal of Finance, 52(4), pp.1495~1517 (1997)
- Brickley, J., "Outside directors and the adoption of poison pills", Journal of Financial Economics, 35(3), pp.371~390 (1994)
- Buchholtz, A., "Role of chief executive officers in takeover resistance: Effects of CEO incentives and individual characteristics", Academy of Management Journal, 37(3), pp.554~579 (1994)
- Bushee, B., "The influence of institutional investors on myopic R and D investment behavior", The Accounting Review, 73(3), pp.305~333 (1998)
- Cary, W., "Corporate devices used to insulate management from attack", The Business Lawyer, 25(2), pp.839~844 (1970)
- Cheng, S., "R&D expenditures and CEO compensation", The Accounting Review, 79(2), pp.305~328 (2004)
- Chung, R., "Institutional monitoring and opportunistic earnings management", Journal of Corporate Finance, 8(1), pp.29~48 (2002)
- DeAngelo, H., "Antitakeover charter amendments and stockholder wealth", Journal of Financial Economics, 11(1-4), pp.329~359 (1983)
- DeAngelo, L., "Managerial competition, information costs, and corporate governance: The use of accounting performance measures in proxy contests", Journal of Accounting and Economics, 10(1), pp.3~36 (1988)
- Dechow, P., "The quality of accruals and earnings: The role of accrual estimation errors", The Accounting Review, 77(Supplement), pp.35~59 (2002)
- R. Sloan, "Detecting earnings management", The Accounting Review, 70(2), pp.193~225 (1995)
- Dichev, D., "Earnings quality: Evidence from the field", Journal of Accounting and Economics, 56(2-3), pp.1~33 (2013)
- Erickson, M., "Earnings management by acquiring firms in stock for stock mergers", Journal of Accounting and Economics, 27(2), pp.149~176 (1999)
- Faleye, O., "Classified boards, firm value, and managerial entrenchment", Journal of Financial Economics, 83(2), pp.501~529 (2007)
- Fan, J., "Corporate ownership structure and the informativeness of accounting earnings in East Asia", Journal of Accounting and Economics, 33(3), pp.401~425 (2002)
- Francis, J., "The role of Big 6 auditors in the credible reporting of accruals", Auditing : A Journal of Practice and Theory, 18(2), pp.17~34 (1999)
- Francis, J., "The market pricing of accruals quality", Journal of Accounting and Economics, 39(2), pp.295~327 (2005)
- Garrahan, M., "Murdochs extend ‘poison pill’ defense at News Corp", Financial Times June 18, ~ (2015)
- Does executive compensation affect investment?, "Gibbons, R.", National Bureau of Economic Research, ~ (1992)
- Healy, P., "The effect of bonus schemes on accounting decisions", Journal of Accounting and Economics, 7(1-3), pp.85~107 (1985)
- Jarrell, G., "Dual-class recapitalizations as antitakeover mechanisms: The recent evidence", Journal of Financial Economics, 20, pp.129~152 (1988)
- Blank check IPOs: A home run for management, "Jog, V.", ~ (2007)
- Kennedy, P., "A guide to Econometrics" (2008), Wiley-Blackwell
- Koh, P., "Accountability and value enhancement roles of corporate governance", Accounting and Finance, 47(2), pp.305~333 (2007)
- Kothari, S., "Performance matched discretionary accrual measures", Journal of Accounting and Economics, 39(1), pp.163~197 (2005)
- Lambert, R., "Golden parachutes, executive decision-making, and shareholder wealth", Journal of Accounting and Economics, 7(1-3), pp.179~203 (1985)
- Louis, H., "Do managers credibly use accruals to signal private information? Evidence from the pricing of discretionary accruals around stock splits", Journal of Accounting and Economics, 39(2), pp.361~380 (2005)
- Malatesta, P., "Poison pill securities: Shareholder wealth, profitability, and ownership structure", Journal of Financial Economics, 20, pp.347~376 (1988)
- Manne, H., "Mergers and the market for corporate control", Journal of Political Economy, 73(2), pp.110~120 (1965)
- McNichols, M., "Discussion of the quality of accruals and earnings: The role of accrual estimation errors", The Accounting Review, 77(Supplement), pp.61~69 (2002)
- Mogavero, D., "The impact of golden parachutes on Fortune 500 stock returns: A reexamination of the evidence", Quarterly Journal of Business and Economics, 34(4), pp.30~38 (1995)
- Partch, M., "The creation of a class of limited voting common stock and shareholder wealth", Journal of Financial Economics, 18(2), pp.313~339 (1987)
- Rangan, S., "Earnings management and the performance of seasoned equity offerings", Journal of Financial Economics, 50(1), pp.101~122 (1998)
- Ryngaert, M., "The effect of poison pill securities on shareholder wealth", Journal of Financial Economics, 20, pp.377~417 (1988)
- Shivakumar, L., "Do firms mislead investors by overstating earnings before seasoned equity offerings?", Journal of Accounting and Economics, 29(3), pp.339~371 (2000)
- Slater, D., "Yahoo shareholders sue boards for golden parachutes", The Wall Street Journal February 26, ~ (2008)
- Sundaramurthy, C., "Corporate governance within the context of antitakeover provisions", Strategic Management Journal, 17(5), pp.377~394 (1996)
- Sundaramurthy, C., "Antitakeover provisions and shareholder value implications : A review and a contingency framework", Journal of Management, 26(5), pp.1005~1030 (2000)
- Teoh, S., "Earnings management and the long‐run market performance of initial public offerings", Journal of Finance, 53(6), pp.1935~1974 (1998)
- Williamson, O., "Markets and hierarchies: Analysis and antitrust implications" (1975), The Free Press
- Yu, F., "Analyst coverage and earnings management", Journal of Financial Economics, 88(2), pp.245~271 (2008)
- Zhao, Y., "Staggered boards and earnings management", The Accounting Review, 83(5), pp.1347~1381 (2008)
- Zhao, Y., "Effects of takeover protection on earnings overstatements: Evidence from restating firms", Review of Quantitative Finance and Accounting, 33(4), pp.347~369 (2009)
- Zhao, Y., "Takeover protection and managerial myopia: Evidence form real earnings management", Journal of Accounting and Public Policy, 31(1), pp.109~135 (2012)