CEO Pay Contracts and IFRS Reconciliations

Georgios Voulgaris, Konstantinos Stathopoulos, Martin Walker

Research output: Contribution to journalArticleScientificpeer-review

4 Citations (Scopus)

Abstract

We examine whether UK managers exploit the discretion provided in the UK GAAP to IFRS reconciliation process to manage earnings and whether this earnings management is associated with the structure of the managers' compensation contracts. We use a comprehensive data set of mainly hand-collected information from the firms' annual reports to provide evidence that, given the existence of an accounting-related vesting target in their pay schemes, CEOs use UK GAAP to IFRS reconciliations as an earnings management tool. We test our hypotheses under a number of different specifications, including a propensity score matching analysis. Our study contributes to the literature on the relation between earnings management and contractual incentives by focusing on a major structural change in accounting policies. © 2014 European Accounting Association.
Original languageEnglish
Peer-reviewed scientific journalEuropean Accounting Review
Volume24
Issue number1
Pages (from-to)63-93
Number of pages31
ISSN0963-8180
DOIs
Publication statusPublished - 2015
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management

Fingerprint Dive into the research topics of 'CEO Pay Contracts and IFRS Reconciliations'. Together they form a unique fingerprint.

  • Cite this