Determinants and economic consequences of voluntary disclosure of internal control weaknesses in China

Xu-dong Ji, Wei Lu and Wen Qu

Journal of Contemporary Accounting and Economics, 2015, vol. 11, issue 1, 1-17

Abstract: This paper investigates the determinants and economic consequences of disclosure of internal control weaknesses (ICWs) by Chinese listed firms under the voluntary disclosure regime over 2010–2011. We find that the probability of firms disclosing ICWs is not only associated with firm characteristics such as profitability, age and business complexity, but is also strongly related to the unique attributes of corporate governance and ownership structure in Chinese listed firms, e.g. the independence of the supervisory board, political connections, concentration of the top 3 shareholders' ownership and tradability of shares.

Keywords: Internal control weakness (ICW); China; Voluntary disclosure; Corporate governance; Ownership structure (search for similar items in EconPapers)
JEL-codes: G34 M41 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jocaae:v:11:y:2015:i:1:p:1-17

DOI: 10.1016/j.jcae.2014.12.001

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