Exploring the link between internationalization of top management and accounting quality: The CFO’s international experience matters

Tobias Dauth, Paul Pronobis and Stefan Schmid

International Business Review, 2017, vol. 26, issue 1, 71-88

Abstract: This study examines whether and how top management internationalization is associated with accounting quality. We combine upper echelons perspectives, agency theory, human capital theory and accounting research, and demonstrate that top management internationalization mitigates the level of managerial discretion in financial reporting. By decomposing the top management team, our analysis reveals that higher levels of accounting quality are associated with the internationalization of the CFO, not the internationalization of the CEO. In particular, we find that CFO’s international education and international work experience are important factors in higher accounting quality.

Keywords: Top management teams; Top management demographics; International executives; Top management internationalization; Board internationalization; CEO; CFO; Earnings management; Accounting quality (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (14)

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DOI: 10.1016/j.ibusrev.2016.05.007

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