This article investigates the relationship between corporate social responsibility and earnings management. Using panel data methodology for a sample of Spanish non-financial companies between 2005 and 2012, we find a negative impact of corporate social responsibility practices on earnings management. Corporate social responsibility is related to ethical and moral issues concerning corporate decision-making. Engaging in socially responsible activities not only improves stakeholder satisfaction, but also has a positive effect on corporate reputation. The results show that corporate social responsibility practices may be an organizational device that leads to more effective use of resources, which then has a negative impact on earnings management practices.

PurposeThe purpose of this paper is to examine the relationship between a firm's internal audit function (IAF) and the quality of its financial reporting. Since regulations on corporate governance were introduced, numerous national and international bodies have emphasized the fundamental role of the IAF in the financial reporting process, especially since it generally leads to higher quality reporting.Design/methodology/approachThe paper uses questionnaires sent to internal audit directors of Spanish banks.FindingsBanks with high quality financial reporting have greater collaboration between internal and external auditors in the annual audit. Greater involvement of internal audit in reviewing financial reporting leads to improved quality financial reporting.Research limitations/implicationsBesides the usual caveats of survey research, there are limitations to this study. First, the problem of response bias may exist. Second, the 66 per cent survey response rate may mean that respondents have larger or better‐developed internal audit functions, affording them more opportunity or motivation to respond to the survey. Hence, the results obtained through the survey may not be generalizable to non‐respondents.Practical implicationsThe findings are relevant for bank regulators, management, boards of directors, and investors. In the current discussion on transparency, integrity and quality of financial reporting, these findings help define the issues.Originality/valuePrevious empirical studies analyse the quality of financial reporting with actors in the corporate governance mosaic (board of directors, audit committee and external audit), but they do not do so directly with the IAF. This paper extends prior banking literature that analyses quality financial reporting along with other variables, but not internal audit.

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Purpose The application of new public governance by many countries has led to the creation of new management systems in public administration and the development of an effective accounting structure with efficient internal control to guarantee a proper provision of services that meet citizens’ requirements. The purpose of this paper is to focus on Spanish local government with the intention of determining the impact of the internal control structure on the disclosure of financial information on the internet. Design/methodology/approach The empirical analysis used combines a descriptive aspect with an explanatory one and seeks to answer the question of whether the internal control system (ICS) influences the disclosure of financial information on the websites of Spanish LGs. The authors use a multivariate model that allows us to verify the predictive capability of the previously defined explanatory variable, internal control, in 1,806 local governments. To test the hypotheses, the authors use two different models. Findings The authors consider the existence and quality of the financial information disclosure in relation to ICSs, and a series of financial and non-financial variables. The authors conclude that the structure of the ICS influences financial information disclosure and its quality. Also, the socio-political variable gives a better explanation of financial information disclosure than the financial variable. Originality/value This research is novel to determine whether the development of ICSs in Spanish municipalities has favored and increased the disclosure of financial information financial through the municipalities’ website transparency portal. These findings will contribute to increase the importance of internal control in the management of public entities.

Innovations in the field of telecommunications and technological development in information processing affect the provision of public services. One of the main priorities of governments is to achieve greater efficiency in the provision of public services and e-government is one of several measures implemented. Our study aims to determine how e-government and efficiency affects the provision of public services in general, and also by functions. We apply a different model to calculate efficiency of the provision of public services and by function. Our empirical analysis, which included correlation and multiple linear regressions, was applied in 2012-2014 for a single cross-section of 35 economies. The results show a significant relationship between e-government and efficiency. Furthermore, we obtain a significant relation between Online Services, Telecommunication Infrastructure and Human Capital with efficiency in the provision of public services.