Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason

This study attempts to provide evidence as to the association between those companies having effective and ineffective internal governance mechanisms with the level of discretionary accruals. In order to achieve the objectives, the earnings management as represented by discretionary accruals have be...

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Main Author:	Ason, Yvonne Joseph
Format:	Thesis
Language:	English
Published:	2007
Subjects:	Corporate organization Corporate governance Earnings management
Online Access:	https://ir.uitm.edu.my/id/eprint/70133/1/70133.pdf
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id	my-uitm-ir.70133
record_format	uketd_dc
spelling	my-uitm-ir.701332023-05-25T06:44:37Z Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason 2007 Ason, Yvonne Joseph Corporate organization. Corporate governance Earnings management This study attempts to provide evidence as to the association between those companies having effective and ineffective internal governance mechanisms with the level of discretionary accruals. In order to achieve the objectives, the earnings management as represented by discretionary accruals have been regressed on the governance variables namely, ownership concentration and proportion of independent directors. The study is based on a sample of 961 observations of the companies that fulfilled the selection criteria from the year 2002 until the year 2005. This study employed the modified Jones model (Dechow et al., 1995) to obtain the discretionary accruals. Meanwhile, linear regression is used to examine the association between discretionary accrual and levels of effectiveness of the governance structure of the firm. The results from the regression show that there is a significant negative relationship between the dummy variable with the level of discretionary accruals. These results imply that the earnings management is higher in a company with ineffective internal governance mechanism. The present study also documents evidence that managers are highly influenced by the largest shareholder to engage in opportunistic earnings management. Therefore, the findings suggest that regulators and authorities concerned should enforce laws and regulations insisting the company maintain good internal governance mechanisms. Besides, academicians must continue to search for other corporate governance mechanisms that help to mitigate earnings management. This is important in preventing the opportunistic earnings management at its early stage before it becomes excessive and finally become a fraud. If the opportunistic earnings management can be reduced at its early stage, investors' wealth will be more well protected. 2007 Thesis https://ir.uitm.edu.my/id/eprint/70133/ https://ir.uitm.edu.my/id/eprint/70133/1/70133.pdf text en public masters Universiti Teknologi MARA (UiTM) Faculty of Accountancy Pok, Wee Ching
institution	Universiti Teknologi MARA
collection	UiTM Institutional Repository
language	English
advisor	Pok, Wee Ching
topic	Corporate organization Corporate governance Earnings management
spellingShingle	Corporate organization Corporate governance Earnings management Ason, Yvonne Joseph Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
description	This study attempts to provide evidence as to the association between those companies having effective and ineffective internal governance mechanisms with the level of discretionary accruals. In order to achieve the objectives, the earnings management as represented by discretionary accruals have been regressed on the governance variables namely, ownership concentration and proportion of independent directors. The study is based on a sample of 961 observations of the companies that fulfilled the selection criteria from the year 2002 until the year 2005. This study employed the modified Jones model (Dechow et al., 1995) to obtain the discretionary accruals. Meanwhile, linear regression is used to examine the association between discretionary accrual and levels of effectiveness of the governance structure of the firm. The results from the regression show that there is a significant negative relationship between the dummy variable with the level of discretionary accruals. These results imply that the earnings management is higher in a company with ineffective internal governance mechanism. The present study also documents evidence that managers are highly influenced by the largest shareholder to engage in opportunistic earnings management. Therefore, the findings suggest that regulators and authorities concerned should enforce laws and regulations insisting the company maintain good internal governance mechanisms. Besides, academicians must continue to search for other corporate governance mechanisms that help to mitigate earnings management. This is important in preventing the opportunistic earnings management at its early stage before it becomes excessive and finally become a fraud. If the opportunistic earnings management can be reduced at its early stage, investors' wealth will be more well protected.
format	Thesis
qualification_level	Master's degree
author	Ason, Yvonne Joseph
author_facet	Ason, Yvonne Joseph
author_sort	Ason, Yvonne Joseph
title	Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
title_short	Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
title_full	Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
title_fullStr	Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
title_full_unstemmed	Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason
title_sort	ownership concentration, board structure and earnings management: malaysian evidence / yvonne joseph ason
granting_institution	Universiti Teknologi MARA (UiTM)
granting_department	Faculty of Accountancy
publishDate	2007
url	https://ir.uitm.edu.my/id/eprint/70133/1/70133.pdf
_version_	1783735925260419072

Ownership concentration, board structure and earnings management: Malaysian evidence / Yvonne Joseph Ason

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