TY  - JOUR
AB  - Purpose This study aims to examine the impact of various dimensions of product market competition on accounting conservatism particularly in the wake of regulatory changes and varying ownership structures in China.Design/methodology/approach This study examines impact of product market competition on accounting conservatism by using conservatism measure of Khan and Watts (2009) and measures for important dimensions of competition such as competition intensity, non-price competition and competition from existing rivals and potential entrants.Findings The findings suggest that competition intensity and non-price competition result in higher conservatism. This study also advocates that industry leaders exhibit lower conservatism as compared to industry followers. Moreover, the authors document positive association between competition from existing/potential rivals and accounting conservative. These findings reveal that regulatory changes (International Financial Reporting Standards adoption) influence the effect of various dimensions of competition on conservatism. The authors also propose that financial reporting practices of state-owned enterprises are not influenced by competition. However, competition affects financial reporting (conservatism) when institutional or managerial ownership is higher.Originality/value The authors document that strategic considerations shape conservative financial reporting decisions of the managers. This study also advocates that when regulatory changes affect the influence of competitive pressure on the conservative reporting decisions of the mangers. Findings also suggest that unlike state ownership, institutional as well as managerial ownership affects the influence of competition on managerial decisions like conservative financial reporting. These results are robust to various alternative measures of conservatism.
VL  - 11
IS  - 4
SN  - 1750-614X
DO  - 10.1108/CMS-12-2016-0248
UR  - https://doi.org/10.1108/CMS-12-2016-0248
AU  - Majeed Muhammad Ansar
AU  - Zhang Xian-zhi
AU  - Wang Zhaonan
PY  - 2017
Y1  - 2017/01/01
TI  - Product market competition, regulatory changes, ownership structure and accounting conservatism: Evidence from China
T2  - Chinese Management Studies
PB  - Emerald Publishing Limited
SP  - 658
EP  - 688
Y2  - 2024/04/25
ER  -