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Revenue Classification Shifting: Does CEO Gender Matter?

Author

Listed:
  • Wenjing Ouyang

    (University of the Pacific, Stockton, CA 95219, USA)

  • Thanh Ngo

    (East Carolina University, Greenville, NC 27858, USA)

  • Hongxia Wang

    (Coastal Carolina University, Conway, SC, USA)

Abstract

Instead of managing bottom-line earnings, firms may use revenue classification shifting to inflate core earnings due to its less risky, less costly, but viable features. Female CEOs, being perceived more risk-averse and more ethical, may engage in either more or less revenue classification shifting than male CEOs. Using a sample of 36,427 US firm-year observations from 1993 to 2019, we find that female CEOs tend to engage in less revenue classification shifting than male CEOs when the monitoring environment is looser but increase revenue classification shifting when the monitoring environment becomes more stringent. Further analyses indicate that female CEOs may substitute revenue classification shifting for more costly earnings management tools under stricter monitoring. The results are robust to endogeneity tests, sample selection bias, and additional control variables, providing new evidence that female CEOs are more risk-averse.

Suggested Citation

  • Wenjing Ouyang & Thanh Ngo & Hongxia Wang, 2023. "Revenue Classification Shifting: Does CEO Gender Matter?," Review of Pacific Basin Financial Markets and Policies (RPBFMP), World Scientific Publishing Co. Pte. Ltd., vol. 26(01), pages 1-42, March.
    • Handle: RePEc:wsi:rpbfmp:v:26:y:2023:i:01:n:s0219091523500029
    DOI: 10.1142/S0219091523500029
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    More about this item

    Keywords

    CEO gender; female CEOs; revenue classification shifting;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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