The Tone From Above: The Effect of Communicating a Supportive Regulatory Strategy on Reporting Quality

Posted: 2 Aug 2018

See all articles by Sanne R. van Duin

Sanne R. van Duin

VU University Amsterdam

Henri C. Dekker

Vrije Universiteit Amsterdam

J. Wielhouwer

VU University Amsterdam

Juan Mendoza

VU University Amsterdam

Date Written: May 1, 2018

Abstract

In collaboration with the Authority for the Financial Markets in the Netherlands, we manipulate the content of official letters that instruct financial intermediaries to submit a mandatory self‐assessment. As part of the Registered Report Process, we submitted our hypotheses, experimental procedure, and planned statistical analyses before data collection. We predicted that a request indicating a supportive regulatory attitude has a positive effect on reporting quality on average. We also predicted this effect to be stronger for small firms and for firms with a long‐term orientation, and to become negative for firms with a short‐term orientation. Planned analyses show that a supportive letter reduced reporting quality unless firms had a long‐term orientation, supporting the moderating influence of time horizon, but providing no support for the expected average effect or for moderation by firm size.

Keywords: reporting quality; responsive regulation; support; time horizon

JEL Classification: G28; K42; M48

Suggested Citation

Duin, Sanne and Dekker, Henri C. and Wielhouwer, Jacco L. and Mendoza, Juan, The Tone From Above: The Effect of Communicating a Supportive Regulatory Strategy on Reporting Quality (May 1, 2018). Journal of Accounting Research, Vol. 56, No. 2, 2018, Available at SSRN: https://ssrn.com/abstract=3213534

Sanne Duin

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

Henri C. Dekker

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081 HV
Netherlands

Jacco L. Wielhouwer (Contact Author)

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

Juan Mendoza

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

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