A Study of the Relationship between Corporate Governance Characteristics and Asset Impairment

• Main Authors: Hwa-Juin Lin, 林華珺
• Other Authors: Jian-Hsin Chou
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/55772943080898824414

碩士 === 國立高雄第一科技大學 === 財務管理所 === 97 === With the publication of SFAS No.35 “The accounting for Assets Impairment”, the standard of Taiwan’s financial accounting has made a further connection with international practices. In addition, the adoption of SFAS No.35 also lead to the fact that corporate financial condition can more reveal its real financial status and increase the transparency of its financial statement as well. Previous literature indicated that recognition of asset impairment may bring about considerable negative impact on the corporate itself as well as negative market response. Therefore, this study mainly examines whether the corporate can effectively reflect the impaired assets under its governance mechanism. By adopting the Logistic Regression Model, the corporate governance characteristics and its voluntary recognized asset impairment are analyzed. The empirical result shows that the management party is very likely to take an earning bath and smooth earning when confronting asset recognition practices. The stockholding percentage of legal entity is significantly and positively correlated to its voluntary recognized asset impairment and this implies more legal entity stockholders helps in higher disclosure of financial statements. Moreover, based on the samples under strong manipulating earnings incentive with more transfer frequency of high-level managers, poor credit- ranking corporations are significantly and positively correlated to voluntary recognized asset impairment. Furthermore, it results in a notable negative correlation between the non-audit fee charging ratio of accountant and reversed asset impairment, which may be due to the fact that there are possible activities of using reversed asset impairment to manipulate earnings.