The Influences of the Establishment and Quality of Compensation Committee on Managers'' Earnings Management

• Main Authors: Wei-chen Hsu, 許維真
• Other Authors: Chia-fen,Tsai
• Format: Others
• Language: zh-TW
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/wh4m84

碩士 === 國立中山大學 === 財務管理學系研究所 === 106 === This study mainly investigates whether the establishment and the quality of the compensation committee in our country influence the correlation between the total compensation of the executives and corporate performance (pay-performance sensitivities). After analyzing how the quality of the compensation committee affects the pay-performance sensitivities, this study further investigates the effect of the quality of the compensation committee on managerial earnings management. This study takes the listed companies in Taiwan from 2005 to 2016 as the research subjects and finds that the establishment of the compensation committee can significantly enhance the positive relationship between the corporate performance and the total compensation of the executives. This study uses accounting performance (Return on Equity, Return on Assets) and the return on stock price as corporate performance index and finds that the establishment of the compensation committee has a significant impact on increasing the pay-performance sensitivities regardless the corporate performance is measured by accounting index or return on stock price. Further, this study uses listed companies from 2011 to 2016 that revealed the implementation of the compensation committees and the qualifications of the members to conduct the analysis and finds that the higher the quality of the remuneration committee, the higher the pay-performance sensitivities. This study finally analyzes the impact of the quality of the compensation committee on the level of managerial earnings management. The empirical results show that the higher the quality of the compensation committee, the greater the greater the level of earnings management.