Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5107730 | Journal of Accounting and Public Policy | 2016 | 17 Pages |
Abstract
We examine the value relevance of alleged corporate bribery expenditure implied by accounting information. Existing studies have generated mixed evidence regarding the impact of corporate bribery on firms, and often rely on survey-based data that could be prone to bias. The mandatory accounting disclosure of entertainment and travel costs (ETC) by Chinese firms offers a useful research setting for extracting information on alleged corporate bribery expenditure. We show that this measure is negatively related to stock value, but the effect is less pronounced for firms that are underperforming, less supported by government, and based in less-developed regions. Our findings reveal that investors account for alleged corporate bribery expenditure in their valuation decisions, and imply that ETC disclosure may contribute to the scrutiny of corporate bribery.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Accounting
Authors
Yamin Zeng, Edward Lee, Junsheng Zhang,