Artikel
The effect of management characteristics on audit report readability
The present study investigates the relationship between management characteristics (managerial entrenchment, CEO narcissism, overconfidence, board effort, real and accrual-based earnings management) and the audit report readability of listed firms. In other words, this paper seeks to answer the question of "whether management characteristics can have a favourable effect on the audit report readability or not". The multivariate regression model is used for this study. Research hypotheses were also examined using a sample of 1004 observations on the Tehran Stock Exchange during 2012-2018 and by employing multiple regression patterns based on a panel data technique and fixed effects model. The results show a negative and significant relationship between managerial entrenchment and real and accrual-based earnings management and the audit report readability, based on the FOG index, and a positive and significant relationship between management narcissism, CEO overconfidence, and board effort and the audit report readability, based on the FOG index. Moreover, a negative and significant relationship exists between management entrenchment, CEO overconfidence, real and accrual-based earnings management, and audit report readability based on text length and Flesch indices. A positive and significant relationship was evident between CEO narcissism and board effort and audit report readability based on the same indices. Besides, research models were also examined for more confidence using other additional methods, including FE, T + 1, ABB, and GMM, which confirm the study's preliminary results. Since the present study is the first paper to investigate such a topic in the emergent markets, it provides valuable information about intrinsic and acquisitive characteristics of management for users, analysts, and legal institutions that contribute significantly to financial statement readability.
- Language
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Englisch
- Bibliographic citation
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Journal: Economies ; ISSN: 2227-7099 ; Volume: 10 ; Year: 2022 ; Issue: 1 ; Pages: 1-23 ; Basel: MDPI
- Classification
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Wirtschaft
- Subject
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audit report readability
board effort
CEO overconfidence
managerial entrenchment
real and accrual-based earnings management
- Event
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Geistige Schöpfung
- (who)
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Salehi, Mahdi
Zimon, Grzegorz
Seifzadeh, Maryam
- Event
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Veröffentlichung
- (who)
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MDPI
- (where)
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Basel
- (when)
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2022
- DOI
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doi:10.3390/economies10010012
- Handle
- Last update
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10.03.2025, 11:42 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Artikel
Associated
- Salehi, Mahdi
- Zimon, Grzegorz
- Seifzadeh, Maryam
- MDPI
Time of origin
- 2022
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Financial report readability and accounting conservatism
Impact of readability on corporate bond market
Calisthenics with words: The effect of readability and investor sophistication on investors' performance judgment
Religiosity at the top and annual report readability
The interactive effect of ownership structure on the relationship between annual board report readability and stock price crash risk
Audit committee diversity, analysts' forecast accuracy and earnings management: Evidence from Malaysia
Can sustainable corporate governance enhance internal audit function? Evidence from Omani public listed companies
Research on audit supervision of internet finance
The effect of mandatory audit firm rotation on earnings management and audit fees: Evidence from Iran
Does the disclosure of an audit engagement partner's name improve the audit quality? A difference-in-difference analysis
Does engagement partners' effort affect audit quality? With a focus on the effects of internal control system
Do overlapped audit committee directors affect tax avoidance?
Financial report readability and accounting conservatism
Impact of readability on corporate bond market
Calisthenics with words: The effect of readability and investor sophistication on investors' performance judgment
Religiosity at the top and annual report readability
The interactive effect of ownership structure on the relationship between annual board report readability and stock price crash risk
Audit committee diversity, analysts' forecast accuracy and earnings management: Evidence from Malaysia
Can sustainable corporate governance enhance internal audit function? Evidence from Omani public listed companies
Research on audit supervision of internet finance
The effect of mandatory audit firm rotation on earnings management and audit fees: Evidence from Iran
Does the disclosure of an audit engagement partner's name improve the audit quality? A difference-in-difference analysis
Does engagement partners' effort affect audit quality? With a focus on the effects of internal control system