
The Library
Does mutual fund ownership affect financial reporting quality for Chinese privately-owned enterprises?
Tools
Chan, Ann Ling-Ching, Ding, Rong and Hou, Wenxuan (2014) Does mutual fund ownership affect financial reporting quality for Chinese privately-owned enterprises? International Review of Financial Analysis, 36 . pp. 131-140. doi:10.1016/j.irfa.2014.02.004 ISSN 1057-5219.
Research output not available from this repository.
Request-a-Copy directly from author or use local Library Get it For Me service.
Official URL: http://dx.doi.org/10.1016/j.irfa.2014.02.004
Abstract
This paper examines the role of mutual funds in enhancing financial reporting quality in China. Mutual funds are more sophisticated and influential than individual investors. Therefore, they are expected to be more effective at preventing executives from expropriating investors and manipulating earnings as a cover-up, which in turn would reduce the incidence of modified audit opinions (MAOs). Our results, based on the Chinese listed firms from 2003 to 2008, confirm this prediction. More importantly, the effects of mutual fund ownership in reducing the incidence of MAOs are greater among privately owned enterprises (POEs), and especially those with higher growth. This is because POEs rely more heavily on the capital market for financing than do state-owned enterprises (SOEs), and because growth opportunities need to be funded by additional external capital. This finding implies that mutual funds form an important part of the external governance mechanism in emerging countries, but this effect is moderated by state control and ownership.
Item Type: | Journal Article | ||||
---|---|---|---|---|---|
Divisions: | Faculty of Social Sciences > Warwick Business School | ||||
Journal or Publication Title: | International Review of Financial Analysis | ||||
ISSN: | 1057-5219 | ||||
Official Date: | December 2014 | ||||
Dates: |
|
||||
Volume: | 36 | ||||
Page Range: | pp. 131-140 | ||||
DOI: | 10.1016/j.irfa.2014.02.004 | ||||
Status: | Peer Reviewed | ||||
Publication Status: | Published | ||||
Access rights to Published version: | Restricted or Subscription Access |
Request changes or add full text files to a record
Repository staff actions (login required)
![]() |
View Item |