Impact of internal control quality on the information content of social responsibility reports: A study based on text similarity—Evidence from China

Huang, Pingping; Yue-hua, Jiao; Li, Sihai

doi:10.1016/j.accinf.2022.100558

Cited by 23 publications

(11 citation statements)

References 28 publications

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“…As an important safeguard of the corporate governance mechanism, internal control takes a more basic and dominant position in firms' governance (Li et al., 2021). The construction of internal control requires enterprises to build a reasonable organizational structure, form an effective internal monitoring system, and particularly emphasize the need for collective decision‐making in major decisions (Huang et al., 2022). These measures help to improve the corporate governance mechanism, reduce the moral hazards of the management, and make the strategic decision‐making of the enterprise more reasonable (Lin et al., 2023; Skaife et al., 2013).…”

Section: Hypothesis Developmentmentioning

confidence: 99%

Retracted: International expansion and audit opinion shopping: A signaling perspective

Ding

2024

J Corp Accounting Finance

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Opinion shopping is an essential indication of audit collusion. Hence, it is crucial to explore the driving factors of audit uopinion shopping to better control and address this issue. Drawing upon signaling theory, this paper explores the relationship between international expansion and audit opinion shopping and the moderating roles of internal control quality and auditors’ quality. We find that the higher the level of international expansion of an enterprise, the greater the likelihood of audit opinion shopping. Furthermore, we also find that high internal control quality and high auditor quality can weaken the positive relationship between international expansion and audit opinion shopping. Besides, heterogeneity analysis shows that the impact of international expansion on audit opinion shopping is more pronounced in non‐SOEs and firms which stay in the growth and maturity stage. This paper contributes to the antecedent research of audit opinion shopping and exposes the possible “dark side” of international expansion. Finally, this study may provide practical implications to help the authorities better regulate internationalized enterprises as well as contribute to the healthy development of the auditing market.

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Section: Hypothesis Developmentmentioning

confidence: 99%

Retracted: International expansion and audit opinion shopping: A signaling perspective

Ding

2024

J Corp Accounting Finance

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“…Internal control can also assist in more efficient capital allocation and corporate diversification strategies (Wang & Xia, 2022) and increase voluntary disclosure to reduce information asymmetry (Khlif et al, 2021). Subsequent research also proves that good quality internal control can increase information content in reports submitted in social responsibility (Huang et al, 2022), as well as various other positive impacts.…”

Section: Introductionmentioning

confidence: 84%

The Internal Control Effort in Improving Company Performance

Pangaribuan

Sihombing

Sunarsi

et al. 2022

JIMK

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The implementation of effective internal control contributes broadly to improving the implementation of corporate governance and performance. This study aims to confirm and describe how implementing effective internal control can improve company performance. Data were collected based on the respondents' perceptions, namely the internal control units of nine selected companies listed on the Indonesia Stock Exchange. A multiple regression approach processed the data. The test results proposed that the dimensions of internal control, namely monitoring activities, communication and information, control activities, risk assessment, and control environment, have a positive and significant influence on efforts to improve company performance. The board of commissioners must continue to direct and motivate management to implement effective internal control to improve company performance.

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“…Prior studies found that Dow Jones Sustainability Index (DJSI) inclusion, B2C sectors, environmental sensitive industries (Hummel and Szekely, 2022), liberal market economies (Hummel et al , 2022) and regulatory aspects (Hummel and Rötzel, 2019) increase the similarity of reports. In contrast to this, internal control quality (Huang et al , 2022) and mandatory integrated reporting (Sinnewe et al , 2021) reduce similarity. Thus, prior research results stressed that specific firm- and country determinants as firm pressure may lead to symbolic or substantial use of sustainability.…”

Section: Findings Of the Literature Reviewmentioning

confidence: 99%

Automated text analyses of sustainability & integrated reporting. A literature review of empirical-quantitative research

Velte

2023

JGR

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Purpose This study aims to focus on automated text analyses (ATAs) of sustainability and integrated reporting as a recent approach in empirical–quantitative research. Design/methodology/approach Based on legitimacy theory, the author conducts a structured literature review and includes 38 quantitative peer-reviewed empirical (archival) studies on specific determinants and consequences of sustainability and integrated reporting. The paper makes a clear distinction between analyses of reports due to readability, tone, similarity and specific topics. In line with prior studies, it is assumed that more readable reports with less tone and similarity relate to increased reporting quality. Findings In line with legitimacy theory, there are empirical indications that specific corporate governance variables, other firm characteristics and regulatory issues have a main impact on the quality of sustainability and integrated reporting. Furthermore, increased reporting quality leads to positive market reactions in line with the business case argument. Research limitations/implications The author deduces useful recommendations for future research to motivate researchers to include ATA of sustainability and integrated reports. Among others, future research should recognize sustainable and behavioral corporate governance determinants and analyze other stakeholders’ reactions. Practical implications As both stakeholders’ demands on sustainability and integrated reporting have increased since the financial crisis of 2008–2009, firms should increase the quality of reporting processes. Originality/value This analysis makes major contributions to prior research by including both sustainability and integrated reporting, based on ATA. ATAs play a prominent role in recent empirical research to evaluate possible drivers and consequences of sustainability and integrated reports. ATA may contribute to increased validity of empirical–quantitative research in comparison to classical manual content analyses, especially due to future CSR washing analyses.

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Impact of internal control quality on the information content of social responsibility reports: A study based on text similarity—Evidence from China

Cited by 23 publications

References 28 publications

Retracted: International expansion and audit opinion shopping: A signaling perspective

Retracted: International expansion and audit opinion shopping: A signaling perspective

The Internal Control Effort in Improving Company Performance

Automated text analyses of sustainability & integrated reporting. A literature review of empirical-quantitative research

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