The Influence of Corporate Governance Mechanisms on the Behavior of Financial Analysts of US Firms: An Empirical Analysis

Bouteska, Ahmed

doi:10.1108/s1569-373220180000020006

Cited by 8 publications

(12 citation statements)

References 61 publications

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“…The positive and non significant coefficient on DUAL indicates that in the case of jointly assuming both of the directors' board chairman and the CEO responsibilities during a public offering procedure, the firm's monitoring mechanism turns out to be less efficient and its credibility will be questioned, which is likely to generate less reliable earnings forecasts (Bouteska, 2018).…”

Section: Moderated-analysis Resultsmentioning

confidence: 99%

CEO overconfidence and forecast accuracy moderated by CEOs' accounting-based attributes

Ahmed

Jarboui

2022

JMD

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PurposeThe purpose of this paper is to focus on the moderating effect of CEO's accounting-based attributes on the relationship between chief executive officer (CEO) overconfidence and forecast accuracy in European companies.Design/methodology/approachData from a sample of 347 European firms listed on Stoxx Europe 600 index from 2005 to 2018 are used to test the moderation model using moderation regression analysis.FindingsEvidence reveals that CEO overconfidence is negatively associated with forecast accuracy. Further, CEO's accounting-based attributes significantly moderates the impact of CEO overconfidence on forecast quality.Originality/valueThis study is unique in providing European evidence for the moderating effect of CEO's accounting-based attributes on the relationship between CEO overconfidence and forecast quality. This paper is also relevant as it addresses the interaction between two sciences (psychology) to explain the forecast accuracy (accounting).

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Section: Moderated-analysis Resultsmentioning

confidence: 99%

CEO overconfidence and forecast accuracy moderated by CEOs' accounting-based attributes

Ahmed

Jarboui

2022

JMD

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“…The purpose of CG is to minimise agency conflicts and ensure that managers put shareholders' interests first (Epps & Ismail, 2008;Jensen & Meckling, 1976;Vasilakopoulos et al, 2018). The boards of directors are regarded as the most significant component of CG, and their main duties include maintaining a close watch on management's conduct and defending the interests of shareholders (Bouteska, 2018). The board of directors is responsible for overseeing and regulating manager behavior as one of the CG mechanisms to make sure they work in the best interests of shareholders and safeguard their investment (Metawee, 2013;Vasilakopoulos et al, 2018).…”

Section: Supervisory Board Size and Emmentioning

confidence: 99%

Investigating earnings management practices and the role of the board and committees in emerging markets: Evidence from Malaysian public companies

Nuhu

Ahmad

Zhee

2023

J Corp Accounting Finance

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This study was aims to examine the significant elements of the audit and board committee in predicting earnings management (EM) for the period of 2010–2021. The study population comprised total number of 775 listed firms on Bursa Malaysia's main market. The annual audited financial statements and reports of the listed firms, firm's websites, Bloomberg and the Bursa Malaysia website were used as method of data collection. The analytical method used in the current study was descriptive statistic and GLS methods of panel regression. The findings of this study suggested that firms with effective CG mechanisms such as, audit committee size (AUDSIZ), audit committee financial expertise (AUDFEXPT), remuneration and nomination committee (R&NC), supervisory board size (SBS), mitigates accrual, and REM. However, the findings also indicated that gender composition (CGEND) were found to be ineffective in predicting EM.

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“…Dual management denotes attributing the same person the responsibilities of a general manager along with those associated with the chairman of the directors' board over the same period. Previous research has highlighted that in the case of jointly assuming both of the directors' board chairman and the CEO responsibilities during a public offering procedure, the firm's monitoring mechanism turns out to be less efficient and its credibility will be questioned, which is likely to generate less reliable earnings forecasts (Bouteska, 2018).…”

Section: 1mentioning

confidence: 99%

“…Similarly, the forecast publication usually stands as an indication of good news. Bouteska (2018) argues that analysts' earnings forecasts are more accurate for companies where blockholder ownership, either by managers or external entities, have larger quoted spreads. Thus, both signals turn out to target the same purpose, and the authors highlight the predominance of a positive relationship binding the capital share held by the leaders and the forecasts' publishing procedure as well as the quality of such distributed information.…”

Section: 3mentioning

confidence: 99%

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Corporate governance and earnings forecast accuracy in IPO prospectuses: an empirical analysis

Ahmed

Salhi²,

Jarboui

2020

JFRA

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Purpose The purpose of this study is to present an extension to the research area dealing with the Tunisia initial public offering (IPO) associated earnings management forecasts, by an examination of the corporate governance mechanisms and earnings forecast accuracy relating impacts. Design/methodology/approach The authors use a multiple regression technique (FGLS) to estimate the effect of corporate governance structures and audit quality on earnings forecast accuracy. A sample of 33 IPO companies (165 firm-year observations) collected over the period ranging between 2011 and 2015 was applied. Findings The finding of this study reveals that the companies displaying a respectable audit committee size have a significant level of earnings forecast accuracy. Similarly, the accuracy level associated with IPO earnings forecasts is positively influenced by the use of the brand-name auditor. Research limitations/implications This study is based on a small sample from a single jurisdiction and limited time period. In fact, the findings examine how financial statements are measured and reported and assess additional regulation to protect investors and understand as well as manage earnings forecast accuracy in IPO prospectuses. Practical implications The findings of the study provide some implications for regulators, financial analysts, investors and users of financial statements, particularly who are investigating in potentially IPO firms. This study has an implication for market regulators who suggest that a requirement to publish very detailed forecast information would improve market efficiency by reducing the forecast error. Originality/value Previous studies on this subject carried out in other countries with a regulatory framework differ from that of Tunisia, which obligatorily obliges the publication of the forecasts in the prospectus of IPO and capital increase. This is one of the most important studies that simultaneously tests the impacts of corporate governance and audit quality on earnings forecast accuracy in an emerging market, and the results of this study may give strength to Tunisian as well as other developing countries.

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The Influence of Corporate Governance Mechanisms on the Behavior of Financial Analysts of US Firms: An Empirical Analysis

Cited by 8 publications

References 61 publications

CEO overconfidence and forecast accuracy moderated by CEOs' accounting-based attributes

CEO overconfidence and forecast accuracy moderated by CEOs' accounting-based attributes

Investigating earnings management practices and the role of the board and committees in emerging markets: Evidence from Malaysian public companies

Corporate governance and earnings forecast accuracy in IPO prospectuses: an empirical analysis

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