This study examines the relation between controlling shareholders' excess board seats control and financial restatements. An analysis of a sample comprising 106 Taiwanese listed firms (53 restating firms vs. 53 non-restating control firms) shows that financial restatements are more likely to occur when there is a greater divergence between controlling shareholders' board seats control rights and ownership rights. We also find that the excess board seats control of controlling shareholders is positively associated with the materiality and pervasiveness of financial restatements. Overall, these results suggest that the entrenchment incentive from controlling shareholders' excess control motivates firms to adopt aggressive accounting policies.
|頁（從 - 到）||297-314|
|期刊||Review of Quantitative Finance and Accounting|
|出版狀態||Published - 2008 4月|
All Science Journal Classification (ASJC) codes
- 商業、管理和會計 (全部)