Hellenic Open University Conferences, International Conference on Business & Economics of the Hellenic Open University 2015

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Financial Regulation Intervention and Accounting Quality
Panagiotis Dimitropoulos, Stergios Leventis, Emmanouil Dedoulis

Building: Titania
Room: Niki
Date: 2015-02-06 05:00 PM – 07:00 PM
Last modified: 2015-01-27

Abstract


In this paper, we examine whether the quality of financial reporting deteriorates when corporate viability is pursued through regulation and monitoring tied to accounting data. We focus on the European football industry, an ideal setting due to the introduction of a new regulatory framework aimed at improving corporate financial robustness. Our results indicate that the imposition of strict financial regulation has led to a new era associated with increased earnings management, reduced conditional conservatism and auditor switching to a non-big-4. We offer important implications for regulators and market participants alike.


Keywords


Accounting quality; Conservatism; Audit switches; Earnings management; European football clubs