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Corporate governance and financial reporting quality during the COVID-19 pandemic
This paper analyzes whether COVID-19 affects the financial reporting quality of companies and whether corporate governance has a mitigating effect. Using data from UK listed companies, we show that the quality of companies’ financial reporting has been lower during the pandemic. Specifically, compan...
Autores principales: | , |
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Formato: | Online Artículo Texto |
Lenguaje: | English |
Publicado: |
The Authors. Published by Elsevier Inc.
2022
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Materias: | |
Acceso en línea: | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8888352/ https://www.ncbi.nlm.nih.gov/pubmed/35250396 http://dx.doi.org/10.1016/j.frl.2022.102778 |
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author | Hsu, Yu-Lin Yang, Ya-Chih |
author_facet | Hsu, Yu-Lin Yang, Ya-Chih |
author_sort | Hsu, Yu-Lin |
collection | PubMed |
description | This paper analyzes whether COVID-19 affects the financial reporting quality of companies and whether corporate governance has a mitigating effect. Using data from UK listed companies, we show that the quality of companies’ financial reporting has been lower during the pandemic. Specifically, companies have engaged in more earnings management through real activities during the pandemic. We also find that a larger board helps to mitigate the negative impact of COVID-19 on financial reporting quality, although we find no mitigating effect for board independence and CEO duality. This paper provides additional evidence on the impact of COVID-19 on financial reporting quality using a strong country-level governance setting. It is also the first study to analyze the mitigating effect of corporate governance on financial reporting quality during the COVID-19 pandemic. The results of this study provide useful suggestions to the practice. |
format | Online Article Text |
id | pubmed-8888352 |
institution | National Center for Biotechnology Information |
language | English |
publishDate | 2022 |
publisher | The Authors. Published by Elsevier Inc. |
record_format | MEDLINE/PubMed |
spelling | pubmed-88883522022-03-02 Corporate governance and financial reporting quality during the COVID-19 pandemic Hsu, Yu-Lin Yang, Ya-Chih Financ Res Lett Article This paper analyzes whether COVID-19 affects the financial reporting quality of companies and whether corporate governance has a mitigating effect. Using data from UK listed companies, we show that the quality of companies’ financial reporting has been lower during the pandemic. Specifically, companies have engaged in more earnings management through real activities during the pandemic. We also find that a larger board helps to mitigate the negative impact of COVID-19 on financial reporting quality, although we find no mitigating effect for board independence and CEO duality. This paper provides additional evidence on the impact of COVID-19 on financial reporting quality using a strong country-level governance setting. It is also the first study to analyze the mitigating effect of corporate governance on financial reporting quality during the COVID-19 pandemic. The results of this study provide useful suggestions to the practice. The Authors. Published by Elsevier Inc. 2022-06 2022-03-02 /pmc/articles/PMC8888352/ /pubmed/35250396 http://dx.doi.org/10.1016/j.frl.2022.102778 Text en © 2022 The Authors. Published by Elsevier Inc. Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active. |
spellingShingle | Article Hsu, Yu-Lin Yang, Ya-Chih Corporate governance and financial reporting quality during the COVID-19 pandemic |
title | Corporate governance and financial reporting quality during the COVID-19 pandemic |
title_full | Corporate governance and financial reporting quality during the COVID-19 pandemic |
title_fullStr | Corporate governance and financial reporting quality during the COVID-19 pandemic |
title_full_unstemmed | Corporate governance and financial reporting quality during the COVID-19 pandemic |
title_short | Corporate governance and financial reporting quality during the COVID-19 pandemic |
title_sort | corporate governance and financial reporting quality during the covid-19 pandemic |
topic | Article |
url | https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8888352/ https://www.ncbi.nlm.nih.gov/pubmed/35250396 http://dx.doi.org/10.1016/j.frl.2022.102778 |
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