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Domenico Campa

Portait de Domenico Campa
Statut(s) Professeur associé (associate professor)
École International University of Monaco
Date de recrutement 01.09.2015
Axe de recherche Inseec U Risque, prévisions et évaluations en univers complexe
Axe de recherche International University of Monaco Financial service, corporate governance and risk management
Portait de Domenico Campa

Videos de Domenico Campa

Publications

    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • Forthcoming

    Earnings management strategies during financial difficulties: a comparison between listed and unlisted French companies

    Abstract

    This paper investigates and compares the earnings management strategies of listed and unlisted firms during situations involving financial difficulties. The evidence from a sample of 6,407 French non-financial entities from 2009 to 2016 shows that, in the presence of severe financial problems, both listed and unlisted entities exhibit income-increasing earnings manipulation carried out through real activities rather than discretionary accruals. The findings consistently reveal a more extensive use of income-increasing earnings management behaviours among listed firms compared to unlisted entities, especially in the presence of high levels of indebtedness. Thus, they provide full support for the “opportunistic behaviour” hypothesis about the earnings management behaviours of listed firms, at least in the context where firms are highly dependent on external debt and the institutional setting does not provide strong protection to creditors. Finally, the results indicate that, under such circumstances, entities trade off earnings manipulation strategies and define earnings management behaviours based on the probability of being detected, rather than looking at the cost of such earnings management tools.

    • Revue(s) Research in International Business and Finance, Vol. 50, pp. 457-471
    • Classement(s) FNEGE 4, CNRS 4, HCERES C
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • Forthcoming

    Voluntarily IFRS Adoption by European Unlisted Firms: Impact on Earnings Quality and Cost of Debt

    • Co-auteur(s) CAMERAN M.
    • Revue(s) International Journal of Accounting
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article non-classé
    • Transitions sociétales et comportements émergents
    • 2020

    Founder Succession and Firm Performance in the Luxury Industry

    Top management succession may be a real threat for the long-term profitability of companies, in particular when it involves the founder whose name also identifies their brand and their products. This is extremely important in the luxury sector where loyalty, trust and the image of brands in consumers’ minds may be affected by the succession process, especially when the founder has no direct heir to ensure continuity of the family firm. Through an analysis of three case studies, as well as a questionnaire distributed to active consumers of luxury products, this study aims to understand whether and how a brand can successfully survive after the death of its founder and whether the purchasing behaviour of customers changes after a founder succession takes place. Our findings reveal that the lack of a clear and structured succession plan may significantly threaten the survival of companies. In addition, our evidence indicates that the purchasing intention of luxury consumers is linked more to the bond and the values that they share with the founder than to the quality of the goods purchased. Accordingly, our results provide insights and suggestions concerning the optimal approach to follow when companies with heirless founders are planning a succession and highlights that the success and the survival of such entities is linked to consumers’ perceptions of the extent to which there is continuity and alignment between the values of the founder and those of their successors.

    • Co-auteur(s) Torchia M., Marcheselli C.R.C., Sargenti P.
    • Revue(s) Corporate Ownership & Control, 17(2), 88-96.
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2019

    Corporate Social Responsibility Recognition and Support for the Arts: Evidence from European financial institutions

    Abstract

    This research investigates whether financial institutions that have gained a good reputation in relation to their CSR activities also engage in significant corporate support for the arts (CSA). Using a sample composed of the 42 largest listed European financial institutions, data from 2004 to 2013 (i.e., 420 firm-year observations) and manually collected CSA disclosure information, our findings indicate that entities rewarded for their CSR initiatives are also those that engage in significant CSA. We also find that CSA disclosure reported in the social reports of financial institutions is a predictor for the attainment of a CSR award, whereas that reported in annual reports is not. Our findings suggest that annual and social reports have a different informative relevance, at least in relation to CSR initiatives in the form of CSA, for the stakeholders of financial institutions. Thus, our results provide useful insights for companies’ communication strategies showing, for example, that social reports are the best channel to communicate about CSA.

    • Co-auteur(s) Campa D., Zijlmans E.
    • Revue(s) European Management Journal
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2019

    Loan Loss Provisions in Publicly Quoted European Banks and Auditor Independence

    Abstract

    The European Commission, citing deficiencies in the financial statements of banks during the financial crisis, has questioned the independence of the auditors of European banks at the onset of the crisis. We test for evidence of impaired auditor independence by examining if the economic bond between auditors and clients is associated with the audit quality of banks, controlling for the strength of banking regulation of the country in which a bank operates. We find no evidence of income-increasing loan loss provisions being positively associated with the auditor–client economic bond. There is no indication that auditor independence is impaired in EU banks. Stronger country regulation is associated with more conservative provisioning before and after the formation of the European Banking Authority. We also find that the strength of banking regulation mitigates any tendency of auditors' independence to be compromised by the auditor–client economic bond.

    • Co-auteur(s) DONNELLY R.
    • Revue(s) International Journal of Auditing, Vol. 23, pp. 245-262
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2019

    Asset Disposal as a Method of Real Earnings Management: Evidence from the UK

    Abstract

    We examine asset sales as a method of real earnings management around the benchmarks of loss avoidance and last year’s earnings. Evidence is reported of asset sales to boost or reduce earnings near the benchmark of last year’s earnings. For the zero earnings benchmark our results are moderated by the opening balance of accruals: only firms with high levels of accruals use asset sales to boost earnings to avoid a loss and only firms with low levels of accruals use asset sales as part of a big bath. We suggest that firms with high accrual balances find it difficult to use additional income-increasing accruals but find it more convenient to write off accruals rather than sell assets to artificially reduce earnings. International Financial Reporting Standards (IFRS) are associated with reduced use of asset sales for gains and especially with reduced asset sales for losses. We ascribe this to IFRS introducing additional judgement and estimation in relation to the valuation of both long-lived and current assets on a recurring basis.

    • Co-auteur(s) DONNELLY R., TONGYU C.
    • Revue(s) ABACUS Vol 55, Issue 2, pp. 306-332.
    • Classement(s) FNEGE 2, CNRS 3, HCERES A
    • Domenico Campa
    • Article non-classé
    • Création & Innovation
    • 2019

    Art-Based Initiatives and Corporate Governance of Financial Institutions: European evidence following the revised OECD corporate governance framework

    Abstract

    Financial institutions and the arts have been a historical and natural duo since the Middle Ages, when bankers supported the arts sector and artists. This paper investigates the corporate governance (CG) characteristics of today’s financial institutions that engage more extensively with art-based initiatives (ABI). Using a sample composed of the 42 largest European listed financial institutions and manually collected ABI information, the results indicate that, overall, companies with higher levels of CG quality or higher proportions of female directors and entities with greater ownership dispersion, engage more extensively with ABI. This evidence shows that firms with well-implemented CG structures and especially those with a significant presence of women on the board, are more likely to support initiatives aimed at developing and/or preserving cultural heritage. The findings have implications for the arts sector because they provide arts institutions with a better understanding of the companies and people within them that could be their best interlocutors when developing long-term partnerships. They may also encourage “arts-sensitive” investors to target their investment decisions towards institutions with some specific CG attributes.

    • Co-auteur(s) ZIJLMANS E.
    • Revue(s) Poetics: Journal of Empirical Research on Culture, Media and the Arts, Vol. 72, pp. 81-93.
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2018

    Regulatory enforcement and the effectiveness of fraud training: A European investigation into earnings manipulation

    Abstract

    This paper investigates whether the presence of fraud training constrains financial statement manipulation and whether the level of regulatory enforcement of countries (measured as both law enforcement and financial reporting practice enforcement) also plays a role. The evidence from a sample of 500 unique companies listed inthe five largest European countries (i.e., France, Germany, Italy, Spain, and the UK), data from 2009 to 2014 and multivariate analyses with controls for endogeneity reveals that the implementation of fraud training does reduce earnings manipulation. In addition, it indicates that fraud training increases its effectiveness in countries with weaker regulatory enforcement, thus compensating for country-level institutional deficiencies. These results highlight that the additional resources invested by companies in ethics training generate benefits in terms of reduced earnings management and encourage managers of firms located in countries with weaker institutions to implement such measures because, in these contexts, their effectiveness is amplified.

    • Revue(s) Comptabilité Contrôle Audit, Vol. 24, Issue 1, pp. 81-111.
    • Classement(s) FNEGE 2, CNRS 2, HCERES A
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2018

    An investigation of the performance of luxury firms in Europe from an agency theory perspective

    Abstract

    The luxury sector is one of the most significant segments of the economy. It is increasingly attracting the interest of investors given the high margins and growth that companies in this sector exhibit. What is the “secret” of this outstanding performance? Extant literature shows that firm-level strategies, i.e. marketing policies, supply-chain management, R&D investments, etc. are the keys to luxury company success. However, it neglected the investigation of ownership structure, in the context of the agency theory, as another determinant of company performance. This is an important gap since evidence indicates that ownership structure affects features that are crucial to the success of luxury firms. Accordingly, this paper uses a large panel dataset of luxury companies (1,153 unique firms and 8,253 firm-year observations) located in the European continent, OLS multivariate regression models with robust econometric features as well as a robustness test that controls for endogeneity and explores these firms from an agency theory perspective. It finds that luxury entities with higher ownership concentration perform better than the others. This relationship is stronger among non-EU member states and was not affected by the financial crisis. This investigation complements extant research on luxury companies showing that their governance does matter in explaining their success; thus it suggests to researchers of the luxury sector that the ownership structure of these entities cannot be ignored. The evidence reported in the paper helps owners and managers of luxury firms to detect potential agency issues and investors to spot features of highly profitable luxury firms.

    • Revue(s) Corporate Ownership and Control, Vol. 15, Issue (2-1), pp. 161-173.
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2017

    Ownership structure and the performance of Chinese listed firms after the share reform: latest evidence from the manufacturing sector

    Abstract

    This paper investigates the relationship between ownership structure and the financial performance of Chinese manufacturing firms after the implementation of the 2005 reform of tradable and non-tradable shares. Using data from 2011 to 2014 and hand-collected ownership information, the results highlight that ownership concentration and the level of legal person shareholdings have a positive effect on firm performance. They also indicate that the level of state and individual investor shareholdings does not improve company performance. The relationship between the level of state and legal person shareholdings and firm performance is not linear and, in the simultaneous presence of these two ownership types, the dominance of one of the two drives the overall effect. The paper also shows that the 2005 reform has increased ownership dispersion, but has not changed the relationship between the type of dominant shareholder and firm performance highlighted in earlier studies.

    • Revue(s) International Journal of Corporate Governance Vol. 8, Issue 2, pp. 106-127.
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2016

    The Reversal of Impairments of PPE: A test of Fair Value Accounting

    Abstract

    This study examines if the reversal of impairments allowed by IAS 36 as undertaken by UK-quoted companies can be justified as unbiased adjustments to reflect the fair value of the property, plant and equipment assets to which they pertain. We test if the reversals are reflected in the change in stock market prices in an indirect test. We also employ a direct test to establish if the reversals are positively related to changes in subsequent operating performance. Our results suggest that the reversals of impairments are positively related to changes in future performance. Only those reversals that are undertaken when the pre-reversal net income is not negative are reflected in stock market returns. This is somewhat justified by the finding of a differential relation between the ability of the reversals to predict future operating performance and whether the firm is profitable pre-reversal or not. We argue that the results based on the direct test are more convincing and that our results support the decision of the IASB to allow the reversal of impairments.

    • Co-auteur(s) DONNELLY R., TONGYU C.
    • Revue(s) Accounting, Finance and Governance Review, Vol. 22, Issue 2, pp. 1-17.
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2016

    Mandatory IFRS Adoption and Earnings Quality: a Comparison between Italy and the UK

    Abstract

    Evidence pertaining to the effect of IFRS adoption on earnings quality in the EU is mixed with results varying by country. Potential reasons for the conflicting results include the diverse institutional settings in which European firms operate as well as methodological issues. We use a sample of firms operating in Italy and in the UK, matched on the basis of size and industry, to examine the relative changes in earnings quality after the mandatory IFRS introduction. Our results refute the suggestion that IFRS are not suitable for code law countries while they accept the evidence that IFRS do not improve earnings quality when it is already at an adequate level.

    • Revue(s) International Journal of Accounting, Auditing and Performance Evaluation, Vol. 12, Issue 1, pp. 24-44.
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2016

    Comments by the European Accounting Association on the International Accounting Education Standards Board Consultation Paper ‘Meeting Future Expectations of Professional Competence: A Consultation on the IAESB’s Future Strategy and Priorities’

    Abstract

    On December 2015, the International Accounting Education Standards Board (IAESB) issued a consultation paper entitled ‘Meeting future expectations of professional competence: A consultation on the IAESB’s future strategy and priorities’. Its aim is ‘to obtain public comment on its vision for the next five years and the strategic priorities it believes need to be addressed in serving the public interest’ [International Accounting Education Standards Board [IAESB]. (2015a). Meeting future expectations of professional competence: A consultation on the IAESB’s future strategy and priorities. Consultation paper. Retrieved from https://www.ifac.org/publications-resources/consultation-papermeeting-future-expectations-professional-competence, p. 3]. This article reports the answers of the European Accounting Association to the questions asked in the consultation paper. The comments suggest a reinforcement of the entry requirements that would include a proper education background, advanced levels of both some technical competences and interpersonal/communication skills as well as a very strong ethical commitment. They also recommend a more thorough development process for the continuous education of accountants, a stronger link between practitioners and academia, insights for new IESs and more effective communication strategies about IAESB activities.

    • Co-auteur(s) CAMERAN M.
    • Revue(s) Accounting in Europe, Vol. 13, Issue 2, pp. 295-303.
    • Classement(s) FNEGE 4
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2016

    Do Targets Grab the Cash in Takeovers: the Role of Earnings Management

    Abstract

    Extant research on Mergers and Acquisitions (M&A) provides evidence that acquirers underperform subsequent to the takeover completion. Such evidence is more unequivocal for acquirers that finance the acquisition by issuing equity relative to those that use cash. Current literature recognizes various reasons for this underperformance, most of which suggest overvaluation of the acquirers and/or overpayment for the targets at the time of acquisition announcement. Alternatively, this paper aims to investigate whether acquirers' post-takeover abnormal return is also attributed to target firms' real and/or accrual earnings management. Our results indicate that, on average, targets manage earnings upwards using real transactions rather than accruals, during the year preceding the takeover. More specifically, we find evidence of earnings management through sales among targets of cash acquisitions and that it is significantly and negatively related to the post-acquisition performance of the acquirers. These findings suggest that there is an association between the method of financing in acquisitions and earnings management in target firms, which could impact the post-takeover performance of acquirers.

    • Co-auteur(s) HAJBABA A.
    • Revue(s) International Review of Financial Analysis, Vol 44, pp. 56-64.
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2015

    The impact of SME’s pre-bankruptcy financial distress on earnings management tools,

    Abstract

    Previous literature finds that situations that put managers under significant levels of pressure (e.g. IPO, upcoming credit rating changes, violation of debt covenant, etc.) might affect the way earnings are manipulated. The aim of this study is to investigate whether the pressure caused by the non-temporary level of financial distress, conditions the choice between real activity and discretionary accrual manipulation. Using a selection of financial distress indexes and pre-bankruptcy data of a sample of bankrupt small companies operating in a code law country, our findings show that, on average, firms with higher levels of financial distress show more extensive signs of upward earnings management through real transaction manipulation rather than accruals and vice versa. Accordingly, real activity earnings management is preferred over accruals when managers are under significant levels of ‘pressure’ such as being close to face a bankruptcy procedure, despite its implications for the firm in the long term.

    • Co-auteur(s) CAMACHO-MINANO M.
    • Revue(s) International Review of Financial Analysis, Vol. 42, pp. 222-234
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2015

    Non-Audit Services Provided to Audit Clients, Independence of Mind and Independence in Appearance: Latest Evidence from Large UK Listed Companies

    Abstract

    This paper investigates whether the provision of non-audit services (NAS) to audit clients impairs auditor independence of mind and independence in appearance. The main contributions of this paper are in terms of its timeliness with respect to regulatory changes, the simultaneous examination of both forms of auditor independence and the methodological innovation whereby it uses a variable derived from the level of abnormal audit fees as a moderating variable in order to capture the direct impact of the NAS fee level on auditor independence as well as how its influence is moderated by the level of unexpected audit fees. Our results indicate that auditor independence of mind is compromised by the size of NAS fees, particularly for clients who pay below the level of expected audit fee. The stock market perceives that auditor independence is compromised by NAS fees but, at the same time, additional tests indicate that there are benefits that accrue from NAS and, in particular, the relation between return and non-discretionary net income is increasing in NAS fees. The balance of evidence suggests that the European Union is correct in undertaking some reform of the auditing market.

    • Co-auteur(s) DONNELLY R.
    • Revue(s) Accounting and Business Research, Vol. 46, Issue 4, pp. 422-449.
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    IFRS Adoption among Private Companies: Impact on Earnings Quality

    Abstract

    EU gave the opportunity to each Member State to oblige/allow non-listed (i.e., private) companies to use international financial reporting standards (IFRS). Considering a sample of Italian private companies that switched to IFRS in the time span from 2005 to 2008, we compare financial reporting quality between IFRS adopters and a matched sample of companies still using local (Italian) generally accepted accounting principles (GAAP). This should be of interest for the EU Commission in evaluating the impact of the current financial reporting regulation and for EU national regulators, who are left with a certain degree of flexibility in endorsing parts of the European legislation. Overall, our results show that IFRS adoption did not improve reporting quality among private companies but, on the contrary, decreased it. As companies can exploit the level of flexibility embedded in IFRS to pursue their own reporting interests, separate analyses were conducted taking into consideration firms’ incentives. In particular, assuming that entities controlled by listed companies might have switched to IFRS mainly for complying with parent company requirements and/or simplifying the financial reporting process, we run the analyses separately for this sub-sample and other firms. Findings reveal signs of earnings quality deterioration for both groups although the impact seems slightly worse for subsidiaries of listed companies.

    • Co-auteur(s) CAMERAN M., PETTINICCHIO A.
    • Revue(s) Journal of Accounting, Auditing and Finance, Vol. 29, Issue 3, pp. 278-305.
    • Classement(s) FNEGE 3, CNRS 3, HCERES B
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    An Assessment of Corporate Governance Reforms in Italy based on a Comparative Analysis of Earnings Management, Corporate Governance

    Abstract

    The purpose of this paper is to evaluate the impact of corporate governance reforms in Italy. The authors argue that the effectiveness of corporate governance can best be assessed with reference to the choices made by management or controlling shareholders. They use the curtailment of earnings management as a desirable and measureable outcome of good corporate governance to assess Italy’s progress since the 1990s. The UK is used as a reference point because it is a European Union (EU) economy of comparable size and there is evidence that its firms managed earnings to a much lesser extent than their counterparts in Italy in the 1990s. A matched sample of UK and Italian firms was used for the empirical analysis. It was found that in contrast to the situation in the 1990s, firms in Italy do not manage earnings to a greater extent than their UK counterparts after the corporate governance reforms. In addition, firm-level governance has a greater effect on earnings management in Italy than in the UK. The authors attribute this to firm-level governance compensating for deficiencies in national institutions. This paper is the first to use an outcome-driven approach to evaluate the impact of governance reforms.

    • Co-auteur(s) DONNELLY R.
    • Revue(s) The International Journal of Business in Society, Vol. 14, Issue 3, pp. 407-423.
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    Integrity of Financial Information as a Determinant of the Outcome of a Bankruptcy Procedure

    Abstract

    The outcome of a bankruptcy procedure – ‘liquidation’ or ‘reorganization’ – has many legal, economic and social consequences for stakeholders of financial distressed companies. The objective of this paper is to show whether financial information integrity is a determinant for a ‘liquidation’ or ‘reorganization’ decision. Two measures of earnings management as proxies for financial reporting integrity are used on a matched sample of 2064 Spanish bankrupt and healthy companies. The results indicate that only firms which receive a ‘liquidation’ decision manipulate earnings more than their pairs. This study helps to shed light on the consequences of earnings management during a bankruptcy procedure.

    • Co-auteur(s) CAMACHO-MINANO M.
    • Revue(s) International Review of Law and Economics, Vol. 37, pp. 76-85.
    • Classement(s) CNRS 1
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    Earnings Management among Bankrupt Non-Listed Firms: Evidence from Spain

    Abstract

    We analyse whether Spanish non-listed bankrupt firms are more inclined to manage earnings in comparison with their non-bankrupt pairs during the years preceding a legal procedure for bankruptcy. We also investigate the techniques these companies employ to manage earnings and when they start using earnings manipulation practices. Analysing a matched sample of bankrupt and healthy companies, we find that bankrupt firms manage earnings upwards more than their healthy pairs. They achieve that by employing both accrual and real activity manipulation. These two practices start at least three years before the beginning of the bankruptcy procedure, but real activity manipulation stops the year immediately before filing for bankruptcy. Findings also indicate that earnings management tools change based on the industry in which firms operate and the number of years preceding the bankruptcy. This evidence is relevant to governments, monitoring bodies and all those involved in an insolvency procedure.

    • Co-auteur(s) CAMACHO-MINANO M.
    • Revue(s) Spanish Journal of Finance and Accounting, Vol. 43, Issue 1, pp. 3-20.
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2013

    Ireland’s Foreign Direct Investment Sector: the Impact of an Irish Euro zone exit

    Abstract

    The European sovereign debt crisis that has been playing out since 2008 has lead too much questioning over the future of the single currency which, so far, favoured foreign direct investment (FDI) in countries such as Ireland, contributing to their wellbeing and growth. Drawing on data gathered from interviews with individuals involved in different divisions of the FDI sector, namely the services, high-tech and life sciences, this study evaluates the hypothetical consequences for Ireland’s FDI sector, following an Irish Euro zone exit. The findings illustrate that the reactions of foreign companies would heavily depend on the ease of transferability in the organisation’s operations. Ireland outside the Euro zone would struggle to both maintain and attract new FDI. The resultant consequences for Ireland’s economy would include increased unemployment, reduced exchequer returns and export levels, as well as stagnant economic growth.

    • Co-auteur(s) CULL R.
    • Revue(s) Business and Economics Journal, Vol. 4, Issue 2: 082.
    • Domenico Campa
    • Article non-classé
    • Risque, prévisions et évaluations en univers complexe
    • 2013

    Board Structure and Monitoring Effects in Different Institutional Settings: a Comparison between Italy and the UK

    Abstract

    This paper analyses how investor protection provided by the institutional setting in which a firm operates affects the quality of its board of directors. It also investigates whether firms operating in contexts with weaker investor protection rely more on internal corporate governance to prevent dysfunctional behaviour by insiders. This is achieved by the analysis of a matched pair sample of firms listed on the Italian and the UK stock markets. The results indicate that the board composition and structure are of higher quality in the UK. Our findings also suggest that the effectiveness of a boards’ monitoring, measured by its ability to mitigate earnings management, is stronger in Italy. Thus, in a context where the institutional setting provides less investor protection, firm-level governance can substitute for the institutional deficit.

    • Co-auteur(s) DONNELLY R.
    • Revue(s) International Journal of Corporate Governance, Vol. 4, Issue 1, pp. 1-19.
    • Domenico Campa
    • Article classé
    • Risque, prévisions et évaluations en univers complexe
    • 2013

    ‘Big 4 Fee Premium’ and Audit Quality. Latest Evidence from UK Listed Companies

    Abstract

    Using the most recent observations (2005-2011) from a sample of UK listed companies, This paper aims to investigate whether Big 4 audit firms exhibit a “fee premium” and, if this is the case, whether the premium is related to the delivery of a better audit service. Univariate tests, multivariate regressions and two methodologies that control for self-selection bias are used to answer the proposed research questions. Data are collected from DataStream. Findings provide consistent evidence about the existence of an “audit fee premium” charged by Big 4 firms while they do not highlight any significant relationship between audit quality and type of auditor with respect to the audit quality proxies investigated. The evidence from this paper might signal the need for legislative intervention to improve the competitiveness of the audit market on the basis that its concentrated structure is leading to “excessive” fees for Big 4 clients. Findings might also enhance Big 4 client bargaining power. However, as the paper analyses only one country, generalizability of the results might be a limitation. This study joins two streams of the extant literature that investigate the existence of a “Big 4 audit fee premium” and different levels of audit quality among Big 4 and non-Big 4 clients. Evidence supports the concerns raised by the UK House of Lords in 2010 that the concentrated structure of the audit market could be the driver of “excessive” fees for Big 4 clients as it does not find differences in audit quality between Big 4 and non-Big 4 clients.

    • Revue(s) Managerial Auditing Journal, Vol. 28, Issue 8, pp. 680-707.
    • Classement(s) FNEGE 4, CNRS 4, HCERES C

Autres publications

    • Domenico Campa
    • Ouvrage
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    L’Adozione dei Principi Contabili Internazionali da Parte delle Società Italiane. Determinanti ed Effetti (IFRS Adoption from Italian Companies. Determinants and Effects)

    • Editeur(s) EGEA, Milano.
    • Co-auteur(s) CAMERAN M., PETTINICCHIO A.
    • Numéro de parution ISBN 978-88-238-4410-0
    • Domenico Campa
    • Ouvrage
    • Risque, prévisions et évaluations en univers complexe
    • 2014

    Corporate Governance and Quality of Earnings. A comparative Analysis between a Common Law and a Code Law Country

    Abstract

    Well-known corporate scandals (e.g. Enron, Parmalat, Anglo Irish Bank, etc.), have moved corporate governance issues back into the limelight. Properly structured corporate governance is essential to ensure an organization’s integrity and attract external capital at a reasonable cost. This book examines the efficacy of a firm’s corporate governance and board structure in curbing earnings management and whether the effect changes in different legal contexts. This is done using a matched-pairs sample of companies listed in one common law country, the UK, and one code law country, Italy. It is reported that the strong corporate governance and board structure significantly reduce earnings management. The effect is stronger in Italy where these mechanisms act as an effective substitute for a weaker legal protection. The analysis of individual corporate governance attributes shows that institutional investor ownership is the most important feature of UK governance in terms of reducing earnings management, while the avoidance of CEO duality prevails in Italy. These results suggest that corporate governance is more important where the law cannot ensure an adequate investor protection.

    • Editeur(s) LAP Publishing
    • Numéro de parution ISBN 978-3-659-20101-1