The impact of anti-corruption measures and risk effects on equity incentives and financial misreporting in China

This study examines the effects of anti-corruption and equity incentive risk on financial misreporting in context China’s unique corporate ownership structure governance regime. Using a sample comprising 2,708 cases restatement over 2007–2017 period. Our key findings suggest that managers’ shareholdings are significantly positively associated with their firms’ misreporting, certain factors dramatically alter Chinese governance. Furthermore, motivation to misreport is more pronounced non–state owned enterprises (non-SOEs), suggesting mitigate “absence ownership” problem believed affect SOEs. Managers highly competitive industries firms low institutional found be motivated performance.