Influence of Family Ownership on Earnings Quality

IF 0.8 Q4 BUSINESS, FINANCE

Asian Journal of Business and Accounting Pub Date : 2019-12-26 DOI:10.22452/ajba.vol12no2.3

Sang Ho Kim, Y. An

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引用次数: 5

Abstract

Manuscript type: Research paper Research aims: This paper investigates how family ownership affects firm’s earnings quality. The focus is on firms listed on the Korean Stock Exchange (KSE). Design/Methodology/Approach: This study uses panel data to classify family ownership into two categories: pure family ownership and ownership-control disparity (wedge) where wedge is further divided into 1) wedge ratio and 2) wedge multiplier. In addressing the category of ownership-control disparity, it is important to measure how much control rights are greater than ownership rights. Therefore, this study employs the wedge multiplier to overcome the limitation of not separating management control and ownership. Firms’ earnings quality is tested by using four proxies proposed by Jonas and Blanchet (2000): 1) persistence, 2) value relevance, 3) conservatism, and 4) accruals quality. Research findings: This research finds family ownership to be positively associated with earnings quality, value-relevance and accruals quality. However, ownership-control disparity does not reduce the earnings quality. This finding is not consistent with previous studies. Thus, it is deduced that the controlling family shareholders of the chaebol firms have a dominant influence on firms which they invested in by using affiliated ownership. Significant ownership-control disparity is prevalent in chaebol firms, resulting in low earnings quality. Theoretical contribution/Originality: Family ownership is predominant in a number of countries, especially in East-Asian countries. In that regard, this study is important. It contributes to the understanding of family ownerships and firms’ earnings quality not only for the Korean contexts, but also for other East Asian countries. Research limitation/Implications: The four proxies of earnings quality used in this study do not necessarily reflect all aspects of the earnings quality. In this study, the results between family ownership and earnings quality are mixed. The results based on the association between corporate governance and earnings quality could be attributed to the way earnings quality is defined. The management of the chaebol firms or large business groups should try to improve transparency and the quality of their financial reporting.Keywords: Chaebol, Earnings Quality, Family Ownership, Panel Data, Wedge JEL Classification: G32, G34, M41

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家族所有权对盈余质量的影响

论文类型:研究目的:研究家族所有权对企业盈余质量的影响。重点是在韩国证券交易所上市的企业。设计/方法/方法:本研究使用面板数据将家族所有权分为两类:纯家族所有权和所有权-控制权差异(楔形)，其中楔形进一步分为1)楔形比和2)楔形乘数。在解决所有权-控制权差异的范畴时，重要的是衡量控制权比所有权大多少。因此，本研究采用楔形乘数来克服未将经营权与所有权分离的局限性。公司盈余质量通过Jonas和Blanchet(2000)提出的四个代理来检验:1)持久性，2)价值相关性，3)稳健性，4)应计项目质量。研究发现:本研究发现家族所有权与盈余质量、价值相关性和应计项目质量呈正相关。然而，所有权和控制权的差异并没有降低盈余质量。这一发现与之前的研究不一致。由此推断，财阀企业的控股家族股东通过关联所有权对其投资的企业具有支配性影响。财阀企业中普遍存在显著的所有权控制差异，导致盈利质量较低。理论贡献/独创性:家族所有制在许多国家占主导地位，特别是在东亚国家。在这方面，这项研究很重要。它有助于理解家族所有权和企业盈余质量，不仅适用于韩国，也适用于其他东亚国家。研究局限/启示:本研究中使用的四个盈余质量指标并不一定反映盈余质量的所有方面。在本研究中，家族所有权与盈余质量之间的结果好坏参半。基于公司治理与盈余质量之间关联的结果可以归因于盈余质量的定义方式。财阀或大企业集团的管理层应该努力提高财务报告的透明度和质量。关键词:财阀，盈余质量，家族所有权，面板数据，Wedge JEL分类:G32, G34, M41

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来源期刊

Asian Journal of Business and Accounting BUSINESS, FINANCE-

CiteScore

2.00

自引率

11.10%

发文量

期刊介绍： An academic journal that aims to advance knowledge in the business and accounting disciplines, to narrow the gap between theory and practice, and to set direction for policy initiatives in Asia. Welcome to the Asian Journal of Business and Accounting (AJBA). AJBA is an international refereed journal, published biannually (30th June and 30th December) by the Faculty of Business and Accountancy, University of Malaya, Malaysia. AJBA aims to publish scholarly business researches that are relevant to Malaysia and the Asian region. It intends to highlight the practical implications in promoting better business decision making process and the formulation of public policy in Asia. This journal publishes theoretical, conceptual, and empirical papers within the broad areas of business and accounting in Asia. The AJBA covers a broad spectrum of the business and accounting disciplines. A suggestive (though not necessarily comprehensive) list of areas that would be included in this journal are: general management, strategic management, human resource management, organizational behaviour, labour and industrial relations, international business management, business communication, entrepreneurship, leadership, management science, operations management, production management, supply chain management, marketing management, brand management, consumer behaviour, information management, e-marketing, e-commerce, quality management, retailing, service marketing, hospitality management, hotel and tourism management, asset pricing, capital and money markets, corporate finance, derivatives markets, finance and banking, financial economics, etc.