The effectiveness of board of directors and family ownership: interaction and impact on the discretionary accruals Online publication date: Tue, 14-Sep-2021
by Anas Ghazalat
International Journal of Accounting, Auditing and Performance Evaluation (IJAAPE), Vol. 17, No. 1/2, 2021
Abstract: Firms can curb managerial opportunistic behaviours through applying corporate governance mechanisms effectively. Using a sample of 114 Jordanian firms listed on ASE for the period from 2009 until 2015, this study investigates the combined effect of the board of directors and family ownership on the discretionary accruals. The results show that the higher effectiveness of board of directors plays a higher monitoring role to minimise discretionary accruals practices as one of the opportunistic-behaviours. Results also show that the monitoring role of the board of directors is positively moderated in firms with family ownership. This proves that board of directors as a whole in firms with family ownership is unlikely to be effective. This indicates that the corporate governance plays a pivotal role in mitigating the opportunistic behaviours and minimises the divergence gap under the traditional agency problem while it has become a legal fiction when the central-agency problem exists.
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Accounting, Auditing and Performance Evaluation (IJAAPE):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email subs@inderscience.com
Our Blog 
Follow us on Twitter 
Visit us on Facebook