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Earnings Management and Contest to the Control: An Analysis of European Family Firms

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Listed author(s):
  • Jara-Bertin, Mauricio
  • López-Iturriaga, Félix J.

Abstract

This paper analyzes the influence of large shareholders on earnings management in family-owned firms using a sample of firms from 11 European countries. We consider how the contest to the control of the largest shareholder and the existence of a controlling coalition in family-owned firms affect earnings management in these firms. We find that increased contestability of the control of the largest shareholder reduces earnings management in family-owned firms. Our results also show that in firms in which the largest shareholder is a family, a second or third family shareholder increases discretionary accruals.

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File URL: https://mpra.ub.uni-muenchen.de/9660/1/MPRA_paper_9660.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 9660.

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Date of creation: 11 Jul 2008
Handle: RePEc:pra:mprapa:9660
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Keywords: corporate control; discretionary accruals; earnings management; family firms;

Find related papers by JEL classification:

  • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
  • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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Cited by:

  1. Juan Manuel San Martín Reyna, 2012. "An Empirical Examination of Ownership Structure, Earnings Management and Growth Opportunities in Mexican Market," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 2(7), pages 103-123, December.

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