Ownership Structure and Earnings Quality Pre- and Post-Ifrs: Does Investor Protection Matter?

Main Article Content

Saleh Abd Alhadi Rosmila Senik Jalila Johari Hairul Suhaimi Nahar

Abstract

This study investigates whether managerial and institutional ownership is associated with higher earnings quality (EQ) after the implementation of International Financial Reporting Standards (IFRS), compared to the pre-IFRS period. It also examines the moderating effect of investor protection (INPT) on the link between ownership structure and EQ. The study used a dynamic panel data modelling on the sample of 2090 firm-year observations from 2007–2016 in Malaysia. This study applies the Generalized Method of Moments (GMM) to deal with econometric problems. The results indicate that managerial ownership is essential in improving EQ before and after IFRS adoption, whereas no significant improvements were found for institutional shareholders. Similarly, the results provide evidence that managerial ownership is more efficient in monitoring earnings management in healthy INPT environment. The results highlight the significance of accounting standards and law enforcement for enhancing the monitoring role of ownership structure in improving EQ.

Downloads

Download data is not yet available.

Article Details

How to Cite
ABD ALHADI, Saleh et al. Ownership Structure and Earnings Quality Pre- and Post-Ifrs: Does Investor Protection Matter?. Asian Journal of Business and Accounting, [S.l.], v. 13, n. 1, june 2020. ISSN 2180-3137. Available at: <https://ajba.um.edu.my/article/view/18519>. Date accessed: 22 oct. 2020. doi: https://doi.org/10.22452/ajba.vol13no1.4.
Section
Articles