IDEAS home Printed from https://ideas.repec.org/a/bla/jbfnac/v46y2019i3-4p370-399.html
   My bibliography  Save this article

Noncompliance with non‐accounting securities regulations and GAAP violations

Author

Listed:
  • Sunhwa Choi
  • Steven Young
  • Xiu‐Ye Zhang

Abstract

Using enforcement actions by the Securities and Exchange Commission (SEC) as a proxy for noncompliance with securities regulations, we examine whether a firm's compliance with non‐accounting laws and regulations is associated with GAAP violations. We find that firms that violate securities regulations related to non‐accounting issues are more likely to report accounting restatements than control firms that comply with securities regulations. We also find that the difference between the two groups is significant only for the periods subsequent to the start of the noncompliance period but not for periods prior to this date. Our results highlight the interrelation between the accounting and compliance systems, and suggest that managers who are non‐compliant with non‐accounting regulations are also more likely to be non‐compliant with accounting rules.

Suggested Citation

  • Sunhwa Choi & Steven Young & Xiu‐Ye Zhang, 2019. "Noncompliance with non‐accounting securities regulations and GAAP violations," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 46(3-4), pages 370-399, March.
    • Handle: RePEc:bla:jbfnac:v:46:y:2019:i:3-4:p:370-399
    DOI: 10.1111/jbfa.12377
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/jbfa.12377
    Download Restriction: no
    File URL: https://libkey.io/10.1111/jbfa.12377?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jae Hwan Ahn, 2022. "The road not taken: A comparison of Accounting and Auditing Enforcement Releases and securities class actions," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 49(9-10), pages 1489-1529, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jbfnac:v:46:y:2019:i:3-4:p:370-399. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0306-686X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.