An Economic Analysis of Cross-Listing Decisions and Their Impact on Earnings Quality

Roland Königsgruber

Schmalenbach Business Review (sbr), 2009, vol. 61, issue 3, 310-330

Abstract: I examine the conditions under which entrepreneurs signal the high quality of their projects by cross-listing their firms in a jurisdiction with stricter enforcement of financial reporting regulation. I analyze the effect of these cross-listing decisions on international earnings quality, using a model of earnings management and financial reporting enforcement in which stricter enforcement makes accounting manipulation more costly. The analysis shows that firms can use cross-listing decisions to signal high quality projects even in the absence of listing costs. Cross-listing to a jurisdiction with stricter enforcement sometimes actually increases earnings management and generally leads to less earnings management among firms remaining in the domestic market.

Keywords: Analytical Accounting; Cross-Listing; Earnings Management; Earnings Quality; Enforcement (search for similar items in EconPapers)
JEL-codes: G18 M48 (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.vhb.de/sbr/pdfarchive.html (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sbr:abstra:v:61:y:2009:i:3:p:310-330

Access Statistics for this article

Schmalenbach Business Review (sbr) is currently edited by Wolfgang Ballwieser

More articles in Schmalenbach Business Review (sbr) from LMU Munich School of Management Contact information at EDIRC.
Bibliographic data for series maintained by sbr ( this e-mail address is bad, please contact ).