Ownership structure, legal environment and timeliness in loss recognition in China.
This study investigates the effect of accounting reform on the timeliness in loss recognition by incorporating the unique institutional infrastructures in China. Our results show that the inefficient state ownership and weak legal environment are two key factors that limit the effectiveness of the a...
| Main Authors: | , |
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| Other Authors: | |
| Format: | Research Report |
| Published: |
2008
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| Online Access: | http://hdl.handle.net/10356/7032 |
| _version_ | 1826129722237517824 |
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| author | Liang, Chen. Tan, Patricia Mui-Siang. |
| author2 | Nanyang Business School |
| author_facet | Nanyang Business School Liang, Chen. Tan, Patricia Mui-Siang. |
| author_sort | Liang, Chen. |
| collection | NTU |
| description | This study investigates the effect of accounting reform on the timeliness in loss recognition by incorporating the unique institutional infrastructures in China. Our results show that the inefficient state ownership and weak legal environment are two key factors that limit the effectiveness of the accounting reform. As state-owned firms are faced with non-profit maximization goals and poor monitoring by shareholders, creditors, and auditors, they are less timely in recognizing losses compared to non-state-owned firms. Furthermore, accounting reform results in greater timeliness in loss recognition for non-state-owned firms compared to state-owned firms. However, our results also show that the inefficiency of state ownership could be mitigated by the stricter enforcement of laws. The gap in the timeliness in loss recognition between state-owned firms and non-state-owned firms in regions with stringent legal environment is smaller than that in provinces with poor legal infrastructure. |
| first_indexed | 2024-10-01T07:44:49Z |
| format | Research Report |
| id | ntu-10356/7032 |
| institution | Nanyang Technological University |
| last_indexed | 2024-10-01T07:44:49Z |
| publishDate | 2008 |
| record_format | dspace |
| spelling | ntu-10356/70322023-05-19T07:31:17Z Ownership structure, legal environment and timeliness in loss recognition in China. Liang, Chen. Tan, Patricia Mui-Siang. Nanyang Business School DRNTU::Business This study investigates the effect of accounting reform on the timeliness in loss recognition by incorporating the unique institutional infrastructures in China. Our results show that the inefficient state ownership and weak legal environment are two key factors that limit the effectiveness of the accounting reform. As state-owned firms are faced with non-profit maximization goals and poor monitoring by shareholders, creditors, and auditors, they are less timely in recognizing losses compared to non-state-owned firms. Furthermore, accounting reform results in greater timeliness in loss recognition for non-state-owned firms compared to state-owned firms. However, our results also show that the inefficiency of state ownership could be mitigated by the stricter enforcement of laws. The gap in the timeliness in loss recognition between state-owned firms and non-state-owned firms in regions with stringent legal environment is smaller than that in provinces with poor legal infrastructure. 2008-09-18T07:28:18Z 2008-09-18T07:28:18Z 2006 2006 Research Report http://hdl.handle.net/10356/7032 Nanyang Technological University application/pdf |
| spellingShingle | DRNTU::Business Liang, Chen. Tan, Patricia Mui-Siang. Ownership structure, legal environment and timeliness in loss recognition in China. |
| title | Ownership structure, legal environment and timeliness in loss recognition in China. |
| title_full | Ownership structure, legal environment and timeliness in loss recognition in China. |
| title_fullStr | Ownership structure, legal environment and timeliness in loss recognition in China. |
| title_full_unstemmed | Ownership structure, legal environment and timeliness in loss recognition in China. |
| title_short | Ownership structure, legal environment and timeliness in loss recognition in China. |
| title_sort | ownership structure legal environment and timeliness in loss recognition in china |
| topic | DRNTU::Business |
| url | http://hdl.handle.net/10356/7032 |
| work_keys_str_mv | AT liangchen ownershipstructurelegalenvironmentandtimelinessinlossrecognitioninchina AT tanpatriciamuisiang ownershipstructurelegalenvironmentandtimelinessinlossrecognitioninchina |