We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Accounting irregularities, management compensation structure and information asymmetry.
- Authors
Elayan, Fayez A.; Li, Jingyu; Meyer, Thomas O.
- Abstract
The discovery of accounting irregularities is an important negative event for a company. The restatement resulting from the irregularity represents an average of 364 per cent of net income for the 152-firm sample and the irregularities are predominantly revenue enhancing. The irregularity firms exhibit both lower transparency and visibility compared to a matched sample of non-irregularity firms. Furthermore, prior to the announcement, these firms experienced poorer operating performance and their executive compensation structure is found to be significantly more equity-based. Therefore, firms that have greater opportunity and incentive are shown to be more likely to commit accounting irregularities.
- Subjects
COMPENSATION management; RESTATEMENT of corporate earnings; CORPORATION reports; ACCOUNTING fraud; CORPORATE corruption; EXECUTIVE compensation
- Publication
Accounting & Finance, 2008, Vol 48, Issue 5, p741
- ISSN
0810-5391
- Publication type
Article
- DOI
10.1111/j.1467-629X.2008.00266.x