Did mandatory CSR compliance impact accounting Conservatism? Evidence from the Indian Companies Act 2013

IF 2.9 3区 管理学 Q2 BUSINESS, FINANCE Journal of Contemporary Accounting & Economics Pub Date : 2021-12-01 DOI:10.1016/j.jcae.2021.100280
Tara Shankar Shaw , Mehul Raithatha , Gopal V. Krishnan , James J. Cordeiro
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引用次数: 11

Abstract

In 2013, India became the first country in the world to require firms to spend two percent of their average profit on corporate social responsibility (CSR) activities. Taking advantage of this unique event, we examine how the mandatory CSR compliance impacts conditional accounting conservatism of Indian firms. We find a positive relation between CSR compliance and conditional accounting conservatism and this relation is stronger for firms that have stronger governance and weaker for family firms. Further, we find that current period accounting conservatism is negatively related to next period CSR spending. Our results are robust to a battery of tests and are consistent with the notion that Indian firms enhance accounting conservatism to decrease earnings to minimize CSR compliance costs. In other words, while policy makers may have intended to use legislation to increase CSR activities by Indian firms, our results suggest that firms use accounting policies and negative accruals strategically to mitigate CSR spending.

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强制性企业社会责任合规是否影响会计稳健性?来自2013年印度公司法的证据
2013年,印度成为世界上第一个要求企业将平均利润的2%用于企业社会责任(CSR)活动的国家。利用这一独特的事件,我们研究了强制性企业社会责任合规如何影响印度公司的条件会计稳健性。我们发现企业社会责任合规性与条件会计稳健性之间存在正相关关系,且这种关系在治理水平越高的企业中越强,在家族企业中越弱。此外,我们发现当期会计稳健性与下期企业社会责任支出负相关。我们的结果在一系列测试中是稳健的,并且与印度公司提高会计稳健性以减少收益以最大限度地减少CSR合规成本的概念一致。换句话说,虽然政策制定者可能打算通过立法来增加印度企业的社会责任活动,但我们的研究结果表明,企业在战略上使用会计政策和负应计利润来减少企业社会责任支出。
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CiteScore
6.00
自引率
3.00%
发文量
24
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