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CFO tenure, CFO board membership and accounting conservatism
journal contribution
posted on 2019-12-01, 00:00 authored by Mohammad MuttakinMohammad Muttakin, Arifur KhanArifur Khan, George TanewskiGeorge Tanewski© 2019 We examine the influence of chief financial officer (CFO) tenure and CFO board membership on accounting conservatism among Australian listed companies. The study uses market-based (i.e., timeliness of earnings to news) and accounting-based (i.e., accrual-based loss recognition) measures of conservative accounting. The results show that while longer CFO tenure and CFO board membership increases accounting conservativism, this is not the case when CFOs become entrenched through long board-membership tenure. This entrenchment appears to lead to the use of aggressive accounting practices. Overall, the results indicate that CFO tenure and CFO board membership improve financial-reporting quality by increasing accounting conservatism in organizations, providing evidence of the importance of recognizing these two governance characteristics in policymaking and in regulation.
History
Journal
Journal of Contemporary Accounting and EconomicsVolume
15Issue
3Article number
100165Pagination
1 - 20Publisher
ElsevierLocation
Amsterdam, The NetherlandsPublisher DOI
ISSN
1815-5669Language
engPublication classification
C1 Refereed article in a scholarly journalUsage metrics
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