Government accounting supervision and excessive perk consumption of executives: Evidence from China

Di Pan, Wenchuan Chen, Jinjin Zhang and Hongrui Fang

Finance Research Letters, 2023, vol. 57, issue C

Abstract: This paper investigates the effect of government accounting supervision on executives’ excess perk consumption in the context of China. We find that government accounting supervision can inhibit excess perk consumption of inspected firms’ executives. The result of path analysis supports the mediating role of internal control, which has significantly improved after the government accounting inspections. The impact of government accounting inspection is more pronounced in state-owned firms and firms whose inspection results are disclosed with details. Our finding provides a plausibly causal effect of government accounting supervision on executives’ excess perk consumption with the staggered strikes of the inspections.

Keywords: Government accounting supervision; Excessive perk consumption of executives; Nature of property rights; Internal controls (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:57:y:2023:i:c:s1544612323005111

DOI: 10.1016/j.frl.2023.104139

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