National Supervision and Income Smoothing in Banks' Annual Reports

This book explores the relationship between national supervision and manipulative practices in banks' annual reports, particularly income smoothing, focusing on European banks. It investigates whether the characteristics of national supervision affect bank propensity to smooth income and considers the potential role of bank business models. The book provides a comprehensive view on the influence of country-level institutional settings on earnings management in the banking industry.

Format: Paperback / softback
Length: 96 pages
Publication date: 18 May 2021
Publisher: Springer Nature Switzerland AG

This comprehensive book delves into the intricate relationship between the characteristics of national supervision and manipulative practices in banks' annual reports, with a specific focus on income smoothing. The issue at hand is particularly complex, as governmental bodies and regulators have emphasized the critical importance of supervision for enhancing bank transparency since the 2008 financial crisis. However, the impact of supervision on accounting manipulation remains a subject of ongoing debate.

Drawing from a European perspective, the book investigates whether the characteristics of national supervision influence banks' inclination to smooth income. It also examines the potential role of bank business models in this context. By examining a wide range of national supervision characteristics, the book offers a comprehensive exploration of the influence of country-level institutional settings on a widely employed form of earnings management across the banking industry.

The book begins by providing an overview of the theoretical framework and empirical evidence related to the study of income smoothing. It then proceeds to examine the various characteristics of national supervision, including regulatory oversight, enforcement mechanisms, and the political environment. These characteristics are considered in the context of their potential impact on banks' income smoothing practices.

In the subsequent chapters, the book explores the empirical evidence from a sample of European banks. It examines the relationship between national supervision characteristics and banks' income smoothing practices, controlling for other factors such as bank size, industry, and financial conditions. The analysis employs various statistical techniques, including regression analysis and panel data analysis, to provide robust conclusions.

Throughout the book, the authors emphasize the importance of understanding the dynamics between national supervision and manipulative practices in banks' annual reports. They argue that such understanding is crucial for policymakers, regulators, and investors in assessing the financial stability and risk-taking behavior of banks. The book also provides valuable insights into the potential reforms and policies that can be implemented to enhance national supervision and mitigate the risks associated with income smoothing.

In conclusion, this book offers a valuable contribution to the literature on financial regulation and accounting practices. It provides a comprehensive analysis of the relationship between national supervision and manipulative practices in banks' annual reports, with a specific focus on income smoothing. By exploring a wide range of national supervision characteristics and employing robust empirical evidence, the book offers valuable insights into the factors that influence banks' income smoothing decisions and the potential policies and reforms that can be implemented to mitigate these risks.

Weight: 454g
Dimension: 235 x 155 (mm)
ISBN-13: 9783030740108
Edition number: 1st ed. 2021