Corporate Governance and Accounting Conservatism: Evidence from the Impact of Anti-takeover Legislation

Project: Research

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Description

This project intends to investigate the relation between corporate governance and accounting conservatism by focussing on the changes in firms’ financial reporting conservatism before and after the passage of anti-takeover laws. By changing the takeover threat faced by the firms, the introduction of anti-takeover laws changes the external governance mechanism from the corporate control market. Given the documented evidence on the relation between corporate governance and financial reporting quality, accounting conservatism is expected to be affected by the passage of the anti-takeover laws. Furthermore, by an examination of the cross-sectional variation of anti-takeover legislation on conservatism across firms with different corporate governance characteristics, this study can potentially shed light on how different corporate governance mechanisms interact with each other to affect firms’ financial reporting behaviour.

Detail(s)

Project number7200103
StatusFinished
Effective start/end date1/09/079/04/10