Corporate Governance and Income Smoothing Propensity

Liona Lai

《Advances in Quantitative Analysis of Finance and Accounting》 8期 (2010/06) Pp. 251-288

https://doi.org/10.6293/AQAFA.2010.08.11

並列摘要

We use a new empirical approach to investigate the effects of corporate governance on firms' income-smoothing propensity. Extending a model by Dechow (1994), we use a regression framework to examine the negative relationship between the changes in accruals and cash flows and how it is affected by corporate governance mechanisms. Results show that board structure variables are robustly associated with income smoothing while audit quality variables and ownership structure variables are not. Specifically, firms with boards of directors that consist of more outside directors, meet more frequently, are smaller and have less influential CEOs are less inclined to smooth income.

並列關鍵字

Corporate governance ； Income smoothing ； Cash flow ； Accrual

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