The recent spate of fraudulent fina

The recent spate of fraudulent financial reporting in the U.S. has drawn attention to the fact that the Chief Financial Officer (CFO) has a substantial amount of control over a firm’s reported financial results. This paper examines the changes in discretionary accruals surrounding the appointment of a new CFO. Using a sample of 712 companies that appointed a new CFO in the period 1994 to 2000, we find that discretionary accruals decreased significantly following the appointment of a new CFO. Our tests indicate that this reduction is significantly greater for our group of CFO-hiring firms than for a control group of non-hiring firms, and that the changes are not driven by a concurrent appointment of a new Chief Executive Officer (CEO). We also find that our results are largely driven by firms that hire a new CFO from outside the company. Our study extends earlier research by providing empirical evidence that individuals in CFO positions wield significant influence over the firm’s reported financial results and that a firm’s discretionary accruals are significantly reduced surrounding the appoint- ment of a new CFO.

Results (English) 1:

The recent spate of fraudulent financial reporting in the U.S. has drawn attention to the fact that the Chief Financial Officer (CFO) has a substantial amount of control over a firm's reported financial results. This paper examines the changes in discretionary accruals surrounding the appointment of a new CFO. Using a sample of 712 companies that appointed a new CFO in the period 1994 to 2000, we find that discretionary accruals decreased significantly following the appointment of a new CFO. Our tests indicate that this reduction is significantly greater for our group of CFO-hiring firms» coal for a control group of non-hiring firms», and that the changes are not driven by a concurrent appointment of a new Chief Executive Officer (CEO). We also find that our results are largely driven by firms» that hire a new CFO from outside the company. Our study extends earlier research by providing empirical evidence that individuals in CFO positions wield significant influence over the firm's reported financial results and that a firm's discretionary accruals are significantly reduced surrounding the appoint-ment of a new CFO.

Results (English) 2:

The recent spate of fraudulent reporting in the US Financial has drawn attention to the fact Chief Financial Officer là (CFO) has a substantial amount of control over a firm's Reported Financial results. This paper examines the changes in discretionary accruals surrounding the appointment of a new CFO. Using a sample of 712 companies appointed a new CFO có in the period 1994 to 2000, the discretionary accruals We find có sau significantly decreased the appointment of a new CFO. Our tests indicate reduction is significantly greater this có for our group of CFO-hiring Firms control group of coal for a non-hiring Firms, and honest are not driven by the changes a concurrent appointment of a new Chief Executive Officer (CEO). We find có am also largely driven by our results are có hire a new CFO Firms from outside the company. Our study extends earlier research by Providing empirical Evidence có cá CFO positions in the significant wield over the firm's Reported Influence Financial results and honest a firm's discretionary accruals are significantly reduced appoint- ment of a surrounding the new CFO.