Cross listing, bonding and firms' reporting incentives: A discussion of Lang, Raedy and Wilson (2006)

• 成果类型: Article; Proceedings Paper
• 署名作者: Leuz, Christian
• 署名单位: University of Pennsylvania
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2006.04.003
• 发表日期: 2006
• 关键词: UNITED-STATES; ULTIMATE OWNERSHIP; INCOME MANAGEMENT; non-us; PROTECTION; LEGAL

摘要

Lang, Raedy and Wilson (henceforth LRW) (2006) compare the properties of U.S. GAAP accounting numbers across cross-listed and U.S. firms. Using a wide range of properties, LRW show that accounting data are not comparable, even though sample firms use the same accounting standards. I discuss how these findings advance the literature and what they imply for the effectiveness of cross listing as a bonding mechanism. My discussion highlights that documented differences cannot be solely attributed to weak U.S. legal enforcement. I emphasize that accounting standards provide discretion and that cross-listed and U.S. firms are likely to have differential incentives to use this discretion. To illustrate, I document that cross-listed and U.S. firms differ in ownership concentration and that these differences are associated with the level of earnings management. I also provide evidence that home-country institutions continue to influence crosslisted firms' reporting behavior. (c) 2006 Elsevier B.V. All rights reserved.