Can European Banks’ Country-by-Country Reports Reveal Profit Shifting? An Analysis of the Information Content of EU Banks’ Disclosures
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We create a novel database of hand-collected information from the country-by-country reports (CbCRs) of more than 100 multinational bank groups headquartered in the EU for 2014-2016. We compare this new dataset with information from Orbis and Bank Focus to assess in how far the new disclosure obligation increased transparency on banks' tax avoidance behavior. Our descriptive analysis shows that CbCRs uncover a large fraction of worldwide profits and real activities in terms of employees of EU bank groups, especially in tax havens. We also document a striking disconnect between reported profits and real activity, noting considerable heterogeneity between different tax havens and bank groups from different headquarter countries. Regression analysis based on CbCR data and Bank Focus data leads us to expect a tax semi-elasticity of banks' reported profits of about -4.6. In this regard, CbCRs are indicative of a more pronounced tax sensitivity than conventional databases suggest. However, the lack of important economic variables (total assets and staff cost) impedes an exact estimation of banks' profit shifting based on CbCR data alone and with standard methods. These insights are especially relevant in the context of the ongoing political discussions whether to introduce a public CbCR for all large multinational firms in the EU.Keywords:
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The purpose of this research is to investigate the influence of corporate governance mechanisms to mandatory disclosure IFRS on companies listed on the Stock Exchange. Corporate governance mechanisms used in this study include: managerial ownership, institusional ownership, the proportion of independent board, the number of members of the audit committee, board of directors, and board meetings. The sample used in this research is manufacturing companies listed on the Stock Exchange in the year 2013-2015. The total sample is 102 companies were determined by purposive sampling method. These results indicate that the level of compliance with mandatory disclosure convergence of IFRS in the manufacturing companies is 54,89%.This study uses multiple regression analysis to examine the effect of corporate governance mechanisms to mandatory disclosure IFRS. The results of this study indicate that managerial ownership and institutional ownership has significant negative effect on mandatory disclosure IFRS, whereas commissioners significant positive effect on the mandatory disclosure IFRS. The variable proportion of independent board, the number of members of the audit committee and board meetings does not affect the mandatory disclosure IFRS. Keywords: Mandatory disclosure, corporate governance mechanisms
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The purpose of the study is to examine the relationship between firm-specific characteristics, corporate governance factors and the extent of corporate disclosures. Using a sample of listed companies in Bangladesh, the study reports that companies in Bangladesh are improving very slowly in their disclosure of information. Although the level of compliance with mandatory disclosure is relatively high in Bangladesh, the level of voluntary disclosure is still relatively low. The size of the company was found to have significant influence on the level of disclosure, consistent with previous studies. No evidence is found to support the contention that independent boards are associated with increased disclosure. However, percentage of independent non-executive members on audit committee is significantly related to the level of disclosure. This suggests that the regulatory bodies should ensure more independent non-executive directors on the audit committee in order to ensure quality financial reporting.
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This study investigates the effect of two-tier board characteristics, audit committee, and external auditors on earnings management in China. This study contributes to the empirical literature of corporate governance in China that remarkably differs from the Anglo-Saxon structure in terms of boards’ features and auditing. Using a sample of 622 listed Chinese company-years, this study finds that independent directors on the board of directors are negatively related to earnings management while employee supervisors on the supervisory board are not related to earnings management. The results of empirical analysis also show that the presence of audit committees and the brand auditors are negatively associated with earnings management. Finally, the relationship between qualified audit opinions and the level of earnings management are examined. The results show that qualified audit opinion is associated with a higher level of earnings management. Implications of these findings are discussed with regard to the characteristics of corporate governance and auditing settings in Chinese listed companies. In particular, higher proportion of independent directors on the board can improve the quality of reported earnings. However, it indicates that the role of supervisory board to restrain earnings management is limited with the increase of employee members. In addition, the existence of an audit committee improves the quality of reported earnings. Moreover, external audit play a monitoring role in mitigating earnings management in Chinese listed companies.
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Earnings Management
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Journal of Shandong Administrative College and Shandong Economic Management Personnel College (2004)
Corporate governance of listed companies is composed of stakeholders, BOD and managers. Accounting is the core for corporate governance. Supervision and audit are the main measures to prevent from faulty information.
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The legal and regulatory framework for financial reporting in Malaysia is governed by the Companies Act 1965, accounting standards approved by the Malaysian Accounting Standards Board and the Bursa Malaysia Listing Requirements. Voluntary disclosure in the context of Malaysian listed companies can be defined as items of information which are not specified by any of the aforementioned pronouncements.
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We investigate the association between corporate governance strength and EU listed firms' choices with respect to International Financial Reporting Standards (IFRS) adoption in 2005. We measure governance strength by aggregating variables such as board independence, board functioning and audit committee effectiveness. The firms exhibit heterogeneity in both compliance and disclosure quality; some firms do not even meet the minimum disclosure requirements. Regression results show that stronger governance firms disclose more information, comply more fully and use IAS 39's carve-out provision less opportunistically. These findings are germane to accountants, managers and regulators in countries soon to adopt IFRS.
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This study aims to investigate the relationship earnings management and mechanisms of good corporate governance (managerial ownership, institutional ownership, public ownership, the audit committee, board size, and proportion of independent board) on the disclosure of corporate social responsibility on companies listed in Indonesia Stock Exchange period 2009-2013. Analysis technique used is multiple linear regressions. From the empirical result, the study found that in partial managerial ownership, board size, and proportion of independent board significant influence, while variable earnings management, public ownership, and the audit committee did not significantly affect the disclosure of corporate social responsibility.
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The purpose of this study is to analyze the influence of elements of Corporate Governance (CG) on the extent of Corporate Social Responsibility (CSR) disclosure in banking companies listed on the IDX and identify the factors that influence companies to conduct disclosure of Corporate Social Responsibility (CSR). The elements of Corporate Governance in this study consist of managerial ownership, institutional ownership, audit committee, board of commissioners size, independent board of commissioners and audit quality. The results of the hypothesis test indicate that the Corporate Governance (GCG) variable significantly influences the disclosure of Corporate Social Responsibility (CSR) on banking companies listed on the IDX. These results can be proven by the results of hypothesis testing which results in Corporate Governance criteria consisting of managerial ownership, institutional ownership, audit committee, board of commissioners, independent board of commissioners and audit quality simultaneously having a significant effect on the disclosure of Corporate Social Responsibility (CSR) in the company banking registered on the IDX. While partially only institutional ownership and audit quality do not significantly influence the disclosure of Corporate Social Responsibility (CSR) in pharmaceutical sub-sector companies listed on the IDX.
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