التفاصيل البيبلوغرافية
| العنوان: |
Interactive Reporting Bias Surrounding CEO Turnover. |
| المؤلفون: |
Yu, Chia-Feng (Jeffrey)1 (AUTHOR) jeffrey.yu@adelaide.edu.au |
| المصدر: |
European Accounting Review. Jun2017, Vol. 26 Issue 2, p239-282. 44p. 3 Diagrams, 3 Charts. |
| مصطلحات موضوعية: |
Chief executive officers, Earnings announcements, Financial statements, Business turnover, Capital market, Stock prices |
| مستخلص: |
This paper analyzes how CEO turnover affects successive CEOs' financial reporting decisions and the capital market price. I show that when an outgoing CEO (O) in period 1 is succeeded by an incoming CEO (N) in period 2, strategic interaction between O and N leads to interlinked earnings reports. Specifically, when the level of earnings reported by O is lower, N's reporting strategy is more likely to feature a downward reporting bias. Furthermore, by a comparison of the two-CEO setting with a setting with no CEO turnover, I show that with CEO turnover, (i) the period 2 earnings report is more sensitive to the private information of the CEO in control and less sensitive to the period 1 earnings report; (ii) the period 1 earnings report is more sensitive to the private information of the CEO in control; and (iii) the equilibrium stock price has the same sensitivities toward the associated risks, but is less sensitive to the periods 1 and 2 earnings reports. These results provide a novel explanation for managerial under-reporting bias based on strategic interaction between successive CEOs and shed light on the role of CEO turnover in earnings management behavior and capital market responses. [ABSTRACT FROM AUTHOR] |
| قاعدة البيانات: |
Finance Source |
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