Inside directors' characteristics and accruals management: The roles of controlling shareholders' control-cash flow rights deviation, accounting background, and family member

• Published in: Corporate Management Review Vol. 42; no. 1; pp. 71 - 115
• Main Authors: Tai, Yi-Hui, Wang, Ying-Chieh
• Format: Journal Article
• Language: Chinese; English
• Published: Taiwan 國立陽明交通大學管理學院 30.06.2022; National Chiao Tung University, College of Management
• Subjects: Accounting; Cash flow; Directors; Earnings management; Embezzlement; Family owned businesses; Incentives; Influence; R&D; Research & development; Stockholders; Taiwan; 家族成員; accounting background; 會計背景; 內部董事; 控制股東的股份控制權和盈餘分配權偏離程度; controlling shareholders' control-cash flow rights deviation; family member; Inside director; accruals management; 應計盈餘管理
• ISSN: 1028-7310; 1028-7310
• DOI: 10.53106/102873102022064201003

This research takes data of 7,106 Taiwanese-listed companies to investigate the association between the characteristics of inside directors and accruals management under the environment with higher controlling shareholders' control-cash flow rights deviation. When the proportion of inside directors in a firm is greater, our findings reveal that the amount the firm engages in accruals management is larger. Under the same environment, inside directors with an accounting background can mitigate the positive relation between the proportion of inside directors in a firm and the amount the firm engages in accruals management. Regardless of a higher or lower percentage of inside directors served by family members, under higher controlling shareholders' control-cash flow rights deviation, there is a positive relation between the proportion of inside directors and the amount the firm engages in accruals management.