The effect of internal corporate governance mechanisms on impression management in Malaysia

Accounting narratives are an increasingly important medium of financial communication. Research suggests that such narratives are widely used and considered important in the investment decisions of private and institutional investors. However, there is a scarcity of research investigating the associ...

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Main Author:	Al-Sayani, Yahya Mohammed Ahmed
Format:	Thesis
Language:	eng eng
Published:	2021
Subjects:	HF5601-5689 Accounting
Online Access:	https://etd.uum.edu.my/9571/1/depositpermission_s903070.pdf https://etd.uum.edu.my/9571/2/s903070_01.pdf
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id	my-uum-etd.9571
record_format	uketd_dc
spelling	my-uum-etd.95712022-07-04T07:40:24Z The effect of internal corporate governance mechanisms on impression management in Malaysia 2021 Al-Sayani, Yahya Mohammed Ahmed Mohamad Nor, Mohamad Naimi Amran, Noor Afza Tunku Puteri Intan Safinaz School of Accountancy (TISSA) Tunku Puteri Intan Safinaz School of Accountancy (TISSA) HF5601-5689 Accounting HF5667 Professional Ethics. Auditors. Accounting narratives are an increasingly important medium of financial communication. Research suggests that such narratives are widely used and considered important in the investment decisions of private and institutional investors. However, there is a scarcity of research investigating the association between internal corporate governance mechanism and impression management (IM) as part of the presentation of corporate disclosure, especially voluntary disclosure. Nowadays, the issue of IM has become a concern, as accounting narratives are unaudited and thus may be subject to IM, especially in respect of corporate governance as an internal monitoring mechanism to ensure the financial reporting quality. This study examines the influence of board chairman characteristics (independence, tenure, ethnicity, age), board of directors’ characteristics (independence, gender, education, multiple directors), audit committee characteristics (independence, size, meeting, financial expert) and ownership structure (family, managerial, foreign) on IM based on agency and signalling theories. The sample consists of 268 firm-year observations on Bursa Malaysia for 2017 and 2018. This study reveals that chairman independence, tenure, and age, board education, and audit committee independence reduce IM practices and increase the quality of financial reporting. However, chairman ethnicity, board independence, multiple directorships, audit committee meetings, financial expertise, and family ownership increase IM practices and decrease the quality of financial reporting. The practices of managers to engage in IM can be controlled by corporate governance mechanisms especially, chairman independence, tenure and age, board education, and audit committee independence that show a negative relationship with IM. Meanwhile, chairman ethnicity, board independence, multiple directorships, audit committee meeting, financial expert and family ownership showed a positive relationship with IM practices. Based on the findings, this study contributes to a better understanding of IM practices and the internal corporate governance mechanism among Malaysian listed firms by providing a reference point for the relevant parties such as regulatory bodies, policymakers and standard setters towards improving the quality of the financial reporting and corporate governance practices in ensuring credible accounting information. 2021 Thesis https://etd.uum.edu.my/9571/ https://etd.uum.edu.my/9571/1/depositpermission_s903070.pdf text eng 2024-03-12 staffonly https://etd.uum.edu.my/9571/2/s903070_01.pdf text eng 2024-03-12 staffonly other doctoral Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng
advisor	Mohamad Nor, Mohamad Naimi Amran, Noor Afza
topic	HF5601-5689 Accounting HF5601-5689 Accounting
spellingShingle	HF5601-5689 Accounting HF5601-5689 Accounting Al-Sayani, Yahya Mohammed Ahmed The effect of internal corporate governance mechanisms on impression management in Malaysia
description	Accounting narratives are an increasingly important medium of financial communication. Research suggests that such narratives are widely used and considered important in the investment decisions of private and institutional investors. However, there is a scarcity of research investigating the association between internal corporate governance mechanism and impression management (IM) as part of the presentation of corporate disclosure, especially voluntary disclosure. Nowadays, the issue of IM has become a concern, as accounting narratives are unaudited and thus may be subject to IM, especially in respect of corporate governance as an internal monitoring mechanism to ensure the financial reporting quality. This study examines the influence of board chairman characteristics (independence, tenure, ethnicity, age), board of directors’ characteristics (independence, gender, education, multiple directors), audit committee characteristics (independence, size, meeting, financial expert) and ownership structure (family, managerial, foreign) on IM based on agency and signalling theories. The sample consists of 268 firm-year observations on Bursa Malaysia for 2017 and 2018. This study reveals that chairman independence, tenure, and age, board education, and audit committee independence reduce IM practices and increase the quality of financial reporting. However, chairman ethnicity, board independence, multiple directorships, audit committee meetings, financial expertise, and family ownership increase IM practices and decrease the quality of financial reporting. The practices of managers to engage in IM can be controlled by corporate governance mechanisms especially, chairman independence, tenure and age, board education, and audit committee independence that show a negative relationship with IM. Meanwhile, chairman ethnicity, board independence, multiple directorships, audit committee meeting, financial expert and family ownership showed a positive relationship with IM practices. Based on the findings, this study contributes to a better understanding of IM practices and the internal corporate governance mechanism among Malaysian listed firms by providing a reference point for the relevant parties such as regulatory bodies, policymakers and standard setters towards improving the quality of the financial reporting and corporate governance practices in ensuring credible accounting information.
format	Thesis
qualification_name	other
qualification_level	Doctorate
author	Al-Sayani, Yahya Mohammed Ahmed
author_facet	Al-Sayani, Yahya Mohammed Ahmed
author_sort	Al-Sayani, Yahya Mohammed Ahmed
title	The effect of internal corporate governance mechanisms on impression management in Malaysia
title_short	The effect of internal corporate governance mechanisms on impression management in Malaysia
title_full	The effect of internal corporate governance mechanisms on impression management in Malaysia
title_fullStr	The effect of internal corporate governance mechanisms on impression management in Malaysia
title_full_unstemmed	The effect of internal corporate governance mechanisms on impression management in Malaysia
title_sort	effect of internal corporate governance mechanisms on impression management in malaysia
granting_institution	Universiti Utara Malaysia
granting_department	Tunku Puteri Intan Safinaz School of Accountancy (TISSA)
publishDate	2021
url	https://etd.uum.edu.my/9571/1/depositpermission_s903070.pdf https://etd.uum.edu.my/9571/2/s903070_01.pdf
_version_	1747828625288200192

The effect of internal corporate governance mechanisms on impression management in Malaysia

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