The impact of managerial ownership, monitoring and accounting standard choice on accrual mispricing

We analyse to what extent the accrual anomaly is related to the choice of the accounting system as well as firm-level heterogeneity in corporate governance mechanisms. Using a unique dataset of listed German firms over the period 1995 to 2005 we first corroborate former results indicating that the accrual anomaly is also present in Germany. However, this anomaly seems to be driven mainly by firms with managerial ownership. In a second step, we test how different corporate governance mechanisms affect the anomaly. For the German experiment on voluntary adoption of IFRS our results confirm previous findings that the anomaly is less likely to be present under a conservative accounting system. While creditor monitoring is able to reduce the accrual anomaly, shareholder monitoring is not. Apart from offering evidence related to the cross-sectional difference in the degree of accrual mispricing, our results give also some insights related to the cross-country variation of this phenomenon. --Accrual Anomaly,Earnings Quality,Corporate Governance,Managerial Ownership,Capital Market Efficiency,Accounting Standard,Shareholder Monitoring,Creditor Monitoring

International financial reporting standards and earnings Quality: the myth of voluntary vs. mandatory adoption

We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics and that size, leverage, age, bank ownership and ownership concentration influenced the decision to voluntarily adopt IFRS. However, regardless of the decision to voluntarily adopt IFRS, we find that conditional conservatism increased under IFRS for both groups of adopters, while evidence does not suggest an increase in value relevance under IFRS. Results on earnings management in the post-adoption period are mixed. While income smoothing decreases for voluntary but not for mandatory adopters, discretionary accruals only decrease for mandatory but not for voluntary adopters. However, further analyses suggest that the capital market environment and the economic cycle during the adoption period seem to be a more powerful explanation for this evidence than voluntary or mandatory IFRS adoption. Therefore, we conclude that incentives to voluntarily adopt IFRS did not unambiguously dominate accounting standards in determining earnings quality in the case of German firms. --IAS regulation,IFRS,corporate ownership structures,insider ownership,incentives,earnings quality

The impact of managerial ownership, monitoring and accounting standard choice on accrual mispricing

We analyse to what extent the accrual anomaly is related to the choice of the accounting system as well as firm-level heterogeneity in corporate governance mechanisms. Using a unique dataset of listed German firms over the period 1995 to 2005 we first corroborate former results indicating that the accrual anomaly is also present in Germany. However, this anomaly seems to be driven mainly by firms with managerial ownership. In a second step, we test how different corporate governance mechanisms affect the anomaly. For the German experiment on voluntary adoption of IFRS our results confirm previous findings that the anomaly is less likely to be present under a conservative accounting system. While creditor monitoring is able to reduce the accrual anomaly, shareholder monitoring is not. Apart from offering evidence related to the cross-sectional difference in the degree of accrual mispricing, our results give also some insights related to the cross-country variation of this phenomenon

International Financial Reporting Standards and Earnings Quality: The Myth of Voluntary vs. Mandatory Adoption

We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics and that size, leverage, age, bank ownership and ownership concentration influenced the decision to voluntarily adopt IFRS. However, regardless of the decision to voluntarily adopt IFRS, we find that conditional conservatism increased under IFRS for both groups of adopters, while evidence does not suggest an increase in value relevance under IFRS. Results on earnings management in the post-adoption period are mixed. While income smoothing decreases for voluntary but not for mandatory adopters, discretionary accruals only decrease for mandatory but not for voluntary adopters. However, further analyses suggest that the capital market environment and the economic cycle during the adoption period seem to be a more powerful explanation for this evidence than voluntary or mandatory IFRS adoption. Therefore, we conclude that incentives to voluntarily adopt IFRS did not unambiguously dominate accounting standards in determining earnings quality in the case of German firms

A Service of zbw Leibniz-Informationszentrum Wirtschaft Leibniz Information Centre for Economics The Impact of Managerial Ownership, Monitoring and Accounting Standard Choice on Accrual Mispricing WORKING PAPER SERIES Center for Entrepreneurial and Financ

Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. offering evidence related to the cross-sectional difference in the degree of accrual mispricing, our results give also some insights related to the cross-country variation of this phenomenon. Terms of use: Documents in JEL Classification: G32, G34, M4, M4

A Service of zbw WORKING PAPER SERIES Center for Entrepreneurial and Financial Studies International Financial Reporting Standards and Earnings Quality: The Myth of Voluntary vs. Mandatory Adoption International Financial Reporting Standards and Earnings

Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We revisit evidence whether incentives or IFRS drive earnings quality changes, analyzing a large sample of German firms in the period from 1998 to 2008. Consistent with previous studies we find that voluntary and mandatory adopters differ distinctively in terms of essential firm characteristics and that size, leverage, age, bank ownership and ownership concentration influenced the decision to voluntarily adopt IFRS. However, regardless of the decision to voluntarily adopt IFRS, we find that conditional conservatism increased under IFRS for both groups of adopters, while evidence does not suggest an increase in value relevance under IFRS. Results on earnings management in the post-adoption period are mixed. While income smoothing decreases for voluntary but not for mandatory adopters, discretionary accruals only decrease for mandatory but not for voluntary adopters. However, further analyses suggest that the capital market environment and the economic cycle during the adoption period seem to be a more powerful explanation for this evidence than voluntary or mandatory IFRS adoption. Therefore, we conclude that incentives to voluntarily adopt IFRS did not unambiguously dominate accounting standards in determining earnings quality in the case of German firms. Terms of use: Documents in JEL Classification: G14, M41, M43, M44, M4

Fever and hypothermia represent two populations of sepsis patients and are associated with outside temperature

Background!#!Fever and hypothermia have been observed in septic patients. Their influence on prognosis is subject to ongoing debates.!##!Methods!#!We did a secondary analysis of a large clinical dataset from a quality improvement trial. A binary logistic regression model was calculated to assess the association of the thermal response with outcome and a multinomial regression model to assess factors associated with fever or hypothermia.!##!Results!#!With 6542 analyzable cases we observed a bimodal temperature response characterized by fever or hypothermia, normothermia was rare. Hypothermia and high fever were both associated with higher lactate values. Hypothermia was associated with higher mortality, but this association was reduced after adjustment for other risk factors. Age, community-acquired sepsis, lower BMI and lower outside temperatures were associated with hypothermia while bacteremia and higher procalcitonin values were associated with high fever.!##!Conclusions!#!Septic patients show either a hypothermic or a fever response. Whether hypothermia is a maladaptive response, as indicated by the higher mortality in hypothermic patients, or an adaptive response in patients with limited metabolic reserves under colder environmental conditions, remains an open question. Trial registration The original trial whose dataset was analyzed was registered at ClinicalTrials.gov (NCT01187134) on August 23, 2010, the first patient was included on July 1, 2011