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The effects of external shocks on market based accounting research (MBAR)

The effects of external shocks on market based accounting research (MBAR)
The effects of external shocks on market based accounting research (MBAR)
The thesis adopts three-chapter requirements and employs quantitative methods. All using difference-in-difference (DID) approach, chapter 2 takes 1999 rulings as an exogenous shock, while chapter 3 and chapter 4 both explore the real impacts of FAS 166/167. Using a sample spanning from 1995-2003 (with 1999 excluded), chapter 2 suggests that the litigation pressure from shareholders might be a potential explanation for managers to smooth income. The findings are robust to confounding laws and the falsification test. And the decrease in income smoothing after the 1999 rulings are more significant when firms fail to meet financial goals, are with more peer pressure, more financially constrained, in non-consumer-oriented industries and with moderate labor unions. My chapter 3 continuously explores the real impact of exogenous shock on accounting manipulation, proving the positive spillover effect of FAS 166/167 on corporate earnings management. We only find the increase in corporate accrual-based earnings management after their lenders adopt FAS 166/167, while no such evidence can be observed in real earnings management. The findings are robust to a battery of concurrent events which are triggered by the financial crisis and might be influential in the shock period. The spillover effect is more significant when firms are facing higher financially stress and experiencing lower-level governance. My chapter 4 extends the line of chapter 3 and proves the positive spillover effect of FAS 166/167 on corporate CSR performance. The main findings are robust to a set of tests and the falsification tests. And the spillover effect is more concentrated among firms which are more financially constrained, more externally monitored and with higher risk levels.
University of Southampton
Sun, Tingyu(Suntina)
0960305a-645a-4c2c-9437-9039f64c6177
Sun, Tingyu(Suntina)
0960305a-645a-4c2c-9437-9039f64c6177
Zhang, Qingjing (Maggie)
af719b43-b76c-4d0e-ad41-ff58ebbc505d
Zhang, Jason
df7b9fa8-04fd-4085-b74d-c9c1506b974e
Song, Wei
3add8071-2708-4b09-beeb-c5e3a6ba7bd1
Li, Yiwei
d9b5e1e1-f355-48aa-8ddc-00963b17b32c

Sun, Tingyu(Suntina) (2024) The effects of external shocks on market based accounting research (MBAR). University of Southampton, Doctoral Thesis, 177pp.

Record type: Thesis (Doctoral)

Abstract

The thesis adopts three-chapter requirements and employs quantitative methods. All using difference-in-difference (DID) approach, chapter 2 takes 1999 rulings as an exogenous shock, while chapter 3 and chapter 4 both explore the real impacts of FAS 166/167. Using a sample spanning from 1995-2003 (with 1999 excluded), chapter 2 suggests that the litigation pressure from shareholders might be a potential explanation for managers to smooth income. The findings are robust to confounding laws and the falsification test. And the decrease in income smoothing after the 1999 rulings are more significant when firms fail to meet financial goals, are with more peer pressure, more financially constrained, in non-consumer-oriented industries and with moderate labor unions. My chapter 3 continuously explores the real impact of exogenous shock on accounting manipulation, proving the positive spillover effect of FAS 166/167 on corporate earnings management. We only find the increase in corporate accrual-based earnings management after their lenders adopt FAS 166/167, while no such evidence can be observed in real earnings management. The findings are robust to a battery of concurrent events which are triggered by the financial crisis and might be influential in the shock period. The spillover effect is more significant when firms are facing higher financially stress and experiencing lower-level governance. My chapter 4 extends the line of chapter 3 and proves the positive spillover effect of FAS 166/167 on corporate CSR performance. The main findings are robust to a set of tests and the falsification tests. And the spillover effect is more concentrated among firms which are more financially constrained, more externally monitored and with higher risk levels.

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More information

Published date: January 2024
Additional Information: All data used in my thesis is secondary data. And the link of WRDS is the link for the secondary database (https://wrds-www.wharton.upenn.edu/)

Identifiers

Local EPrints ID: 486244
URI: http://eprints.soton.ac.uk/id/eprint/486244
PURE UUID: c5a1bb28-2ff1-42fa-9f6f-45e50b24f499
ORCID for Tingyu(Suntina) Sun: ORCID iD orcid.org/0000-0002-5056-9639
ORCID for Jason Zhang: ORCID iD orcid.org/0000-0001-5369-3144

Catalogue record

Date deposited: 15 Jan 2024 17:55
Last modified: 06 Jun 2024 02:08

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Contributors

Author: Tingyu(Suntina) Sun ORCID iD
Thesis advisor: Qingjing (Maggie) Zhang
Thesis advisor: Jason Zhang ORCID iD
Thesis advisor: Wei Song
Thesis advisor: Yiwei Li

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