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Reporting incentives, ownership concentration by the largest outside shareholder, and reported goodwill impairment losses

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  • Abdul Majid, Jamaliah

Abstract

This paper examines the determinants of reported goodwill impairment losses by Malaysian listed companies from 2006 to 2010. The results show managers' reporting incentives are significantly associated with the reported impairment losses. The results also show that the effect of “big bath” reporting on the reported impairment losses was moderated by the largest outside shareholder ownership concentration. Further analyses reveal that “big bath” reporting is not found in companies with a controlling outside shareholder. These findings suggest that increased ownership by the largest outside shareholder is associated with increased shareholder monitoring of the managers' “big bath” reporting.

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  • Abdul Majid, Jamaliah, 2015. "Reporting incentives, ownership concentration by the largest outside shareholder, and reported goodwill impairment losses," Journal of Contemporary Accounting and Economics, Elsevier, vol. 11(3), pages 199-214.
    • Handle: RePEc:eee:jocaae:v:11:y:2015:i:3:p:199-214
    DOI: 10.1016/j.jcae.2015.07.002
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    Cited by:

    1. Runesson, Emmeli & Samani, Niuosha, 2023. "Goodwill or “No-will”: Hubris in the tone at the top," Journal of Contemporary Accounting and Economics, Elsevier, vol. 19(1).
    2. Hongwen Han & Jiali Jenna Tang & Qingquan Tang, 2021. "Goodwill Impairment, Securities Analysts, and Information Transparency," European Accounting Review, Taylor & Francis Journals, vol. 30(4), pages 767-799, August.
    3. Jamaliah Abdul Majid & Robiah Abu Bakar & Nor Asma Lode, 2016. "The Timing of Goodwill Write-off: Cases of Initial Overpayment," International Business Research, Canadian Center of Science and Education, vol. 9(11), pages 65-69, November.
    4. d'Arcy, Anne & Tarca, Ann, 2018. "Reviewing IFRS Goodwill Accounting Research: Implementation Effects and Cross-Country Differences," The International Journal of Accounting, Elsevier, vol. 53(3), pages 203-226.

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    More about this item

    Keywords

    Largest outside shareholder; Goodwill impairment; Accounting discretion; Ownership concentration; Emerging economy; Mandatory accounting change;
    All these keywords.

    JEL classification:

    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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