Journal article
Voluntary vs. Forced Financial Restatements: The Role of Board Independence
Financial analysts journal, Vol.65(5)
01 Sep 2009
Abstract
Using a sample of companies that restated their earnings over the period 1997-2002, this study finds that the probability of voluntary as opposed to forced restatements is positively related to the independence of both the board of directors and the audit committee. Following both voluntary and Forced earnings restatements, companies increase the proportion of independent directors on both the board and the audit committee; three years after restatements, both types of restating companies attain similar levels of director independence. Moreover, the study finds comparable post restatement long-run stock performance for all restating and matched companies, which suggests that post restatement enhancements to internal control systems help restore companies' blemished reputations.
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Details
- Title
- Voluntary vs. Forced Financial Restatements: The Role of Board Independence
- Creators
- Dalia Marciukaityte - Drexel UniversitySamuel H. Szewczyk - Drexel UniversityRaj Varma - University of Delaware
- Publication Details
- Financial analysts journal, Vol.65(5)
- Publisher
- CFA INST
- Number of pages
- 15
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Identifiers
- 991019167864404721
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Source: InCites
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- Collaboration types
- Domestic collaboration
- Web of Science research areas
- Business, Finance