Search results

The aim of this paper is to examine how managerial ability affects corporate tax aggressiveness.

The study follows the work of Demerjian, Lev, and McVay (2012) and quantifies managerial ability by calculating how efficiently managers generate revenues from given economic resources using the data envelopment analysis (DEA) approach. The study uses a wide range of measures of tax aggressiveness. Firm fixed-effects regressions and a difference-in-differences approach using information regarding CEO turnover to control for endogeneity are used.

The study finds a negative relationship between managerial ability and corporate tax aggressiveness. Further tests show that this negative relationship is more pronounced for firms with higher investment opportunities or firms with more reputational concerns.

Given the significant costs associated with tax aggressiveness and the negative effect it can have on managerial reputation if discovered, the results suggest that more able managers invest less effort in aggressive tax avoidance activities. This study furthers the understanding of how managerial personal traits affect corporate decision-making.

We empirically investigate the hypothesis that the less transparent (more difficult to value) the target’s assets are the more likely it is that the acquiring firm can obtain higher short- and long-term returns. We analyze a sample of 1,538 friendly acquisitions partitioned in two separate dimensions: acquisitions of public versus private firms, and acquisitions of a firm’s assets versus acquisitions of a firm’s assets and its management. Using a sample of (nondiversifying) real estate transactions with a public REIT as the acquirer, we find that acquisitions of public firms have insignificant short-term abnormal returns. Acquisitions of private targets have positive and significant short-term abnormal returns. The acquirer’s abnormal returns are higher in both cases when the transactions involve acquisition of the target firm’s management. We find parallel results when analyzing the acquirer’s Q over the merger year and the three following years. Our conclusions are robust to the type of financing (cash, stock, or a combination) used in the acquisition.

It is a very prominent problem that Chinese universities lack school-running characteristics. In the past ten years, because of undergraduate teaching assessment requirements of the Ministry of Education, universities attach great importance to school-running characteristics. What is the reality and how to improve the effectiveness of creating the school-running characteristics of universities? It is a problem that needs to be solved. The purpose of this paper is to discuss these issues.

Using the survey method, literature study, case studies and other methods, this study reviewed ten years of school-running characteristics construction and explored some laws of creating school-running characteristics.

This study found although universities in China are beginning to attach great importance to the school-running characteristics, but they are still staying in the summarization of characteristics. School-running characteristics are very rough. Creating school-running characteristics are mainly efforts responding to the superior government. Creating school-running characteristics should be based on category characteristic. Universities need to change in competition and create characteristics within its history and culture. Universities need to refine the core idea of education, develop a big picture and then renew them in the assessment cycle.

The originality of this study was that it put forward some new laws including changing from summarizing to creating its own school-running characteristics, putting category characteristic as the prerequisite and considering the core idea of education as the focus of school-running characteristics. This research will enrich the theory building of higher education research and has some value in promoting the creation of school-running characteristics.

This study aims to build on the organizational learning theory and propose a complex strategy by combining strategic alliance with subsequent acquisitions to penetrate new product markets. The authors empirically examined whether and to what extent preacquisition alliance experience affects the short- and long-term stock performance of acquiring firms.

Data on acquisitions, in which the acquirers have experience from preacquisition alliance activities in their targets’ respective industry, were collected. Diversifying acquisitions were focused upon to ensure that preacquisition alliance experience is the major source of organizational learning. A standard event study to examine acquirers’ abnormal returns was used and a Fama-French calendar-time portfolio approach to gauge long-run abnormal stock performance was adopted. In addition, regression analysis was conducted to investigate the alliance–acquisition relationship, controlling a set of variables capturing firm and acquisition characteristics.

It has been documented that in the short run, alliance experience may not always benefit acquirers’ stock performance surrounding the acquisition announcements. In particular, for acquiring firms experiencing negative cumulative abnormal returns, investors value alliance experience negatively. However, for up to 36 months after acquisitions, acquirers with alliance experience outperform their counterparts in almost every acquisition category regardless of the short-term announcement returns.

The current study has used a large-scale representative sample to investigate the dynamic interaction between alliances and acquisitions as two organizational forms for firms to grow. Findings indicate that firms can deliberately learn from their alliance activities and, later on, enter new markets through acquisitions. More importantly, it was found that, at least for some acquirers, preacquisition alliance activities are associated with worse short-term stock price performance because of possible information spillover and lifted entry barriers. It was confirmed that short-term pain nets long-term gains for acquirers heading into new markets.

This study examines whether knowledge about a loan applicant's auditor affects commercial loan decisions. The research questions addressed are: (1) whether a loan officer's familiarity with an applicant's audit firm affects lending decisions, and (2) whether an applicant is negatively impacted by having an audit firm with a history of associations with past borrowers who have defaulted or who have experienced financial statement restatements or regulatory enforcement actions. Participating loan officers were assigned to one of four treatment groups formed by manipulating the above two factors. They made risk assessments of the loan applicant as well as providing probabilities of granting credit. Results indicate that familiarity with a borrower's audit firm reduced assessments of risk associated with lending, but this did not appear to translate into increasing the likelihood that lenders would approve the line of credit. The study also finds an adverse impact on risk assessments and lending decisions when a borrower's audit firm has a negative history of associations with past borrowers.

This paper reviews studies that have examined how accounting information impacts commercial lending judgments. Issues discussed involve the usefulness of accounting data in lending decisions, effects of different accounting methods on lenders’ judgments, bankruptcy and default judgments, and decision processes pertaining to the use of accounting information in lending decisions. Additionally, the paper reviews the research on how audits and other forms of assurance influence commercial loan officers’ judgments. Topics include the way perceived auditor independence influences loan officers’ judgments, the impact of financial statement audits and audit opinions on lending decisions, how internal control reports and other CPA firm reports influence loan decisions, ways in which audit report disclosures and wording impact lending decisions, how perceived auditor quality affects lending decisions, and the effects of limited assurance engagements on loan officers’ judgments.

The purpose of this paper is to develop a goodness index based on Hamming distance and ordered weighted averaging distance (OWAD), which is useful to make decisions. These alternative measures enrich the results of diagnostic fuzzy models and facilitate the experts’ task in decision-making. An application to a set of firms to verify the results is also presented.

The paper follows the basis of OWA operators to design a methodology to reduce the map of causes of business failure into monitoring key areas.

The present paper introduces two alternative measures to test the proposal of grouping. In the empirical application, the superiority of the minimum T-norm over other decision rules is verified. The ordered weighted averaging distance (OWAD) goodness index predicts a better adjustment over the index built using OWA and Hamming distance measures.

A useful mechanism to reduce the map of causes or diseases detected in key areas is added through this analysis. At the same time, these key areas can be disaggregated once some alert indicator is identified; this allows knowing the causes that require special attention. This application of OWA can encourage the development of suitable computer systems for monitoring the firm’s problems, alerting regarding failures and easing decision-making.

A comparison of grouping causes into key areas through a goodness index based on Hamming distance and OWAD is proposed. These contributions enrich the Vigier and Terceño (2008) model and could be applied to any model of fuzzy diagnosis to test the results.

This study examines the role of corporate governance on corporate tax avoidance from the developing country perspective of Malaysia.

A sample of 318 firm-year observations from 2016 to 2020 from the 100 largest listed companies in Malaysia was analysed using a fixed effects panel least squares regression model.

CEOs play a significant role in corporate tax avoidance in Malaysia. Specifically, they are motivated by money and power to engage in risky tax avoidance activity. It was also found that corporate governance mechanisms related to the board of directors have a limited effect on companies’ tax compliance issues.

This study’s findings can help regulators and policymakers understand the circumstances leading to increased tax aggressiveness as well as the limitations of certain governance mechanisms in curbing tax avoidance activity within companies. The findings can also assist shareholders and investors in formulating internal policies to create better alignment of their interests with those of management. The unique emerging economy evidence and insights from this study advance knowledge and can inspire fellow researchers in their future studies.

This study differs from most prior studies by examining the governance and tax issue from a developing country perspective, that of Malaysia. Developments in the country’s corporate governance framework and tax landscape in recent years make it relevant and interesting to investigate the issue in this emerging economy. Offering unique empirical evidence and insights from an emerging economy viewpoint, and with findings that may be generalised to other emerging economies sharing similar market traits (particularly ASEAN nations), this study enriches and extends the existing literature.