مقاله انگلیسی رایگان در مورد تاثیر مدیر ارشد مالی به عنوان منشی هیئت مدیره بر قابلیت مقایسه صورت های مالی – الزویر 2023

Abstract

One person serving as both CFO and board secretary is a unique institutional feature in China. Individuals in this senior executive role are responsible for not only the preparation of financial statements but also the coordination of information disclosure. We investigate the relation between a CFO serving as board secretary and financial statement comparability. We find that a CFO serving as board secretary improves the comparability of a firm’s financial statements in additional analysis. This positive effect is more significant when the CFO is female or middle-aged, or has a Bachelor’s degree or higher or a financial background. This paper enriches the theoretical research on CFO’s employment characteristics and the quality of financial reports, and provides reference value for improving the quality of financial reports.

Introduction

Information disclosure of listed companies is essentially a process of information transmission [1]. In the whole process, there are many factors that affect the effect of information transmission, such as the quality of the communication intermediary, the cognition of the receiver, the market environment, etc [2]. Among them, the performance of the information communicator (the discloser) has a direct and key role in the quality of information disclosure [3]. In China, the secretary of the board of directors (hereinafter referred to as “the secretary of the board of directors”), as the “spokesman”, plays an important role as the information disseminator in the process of information disclosure of listed companies [4]. As the starting point of the information dissemination process, the performance of his duties directly affects the quality of information disclosure of the company from the source [5].

A board secretary post is set up to coordinate information disclosure and board meetings according to the Company Law of the People’s Republic of China since 2006. The rules published in 2008 to govern the Listing of Stocks on Shanghai Stock Exchange and Shenzhen Stock Exchange encourage executives with real power to serve as board secretaries. As a bridge between listed companies and investors, board secretaries who cannot fully understand the company’s operations have difficulty conveying useful information to the capital market [6]. Therefore, to enhance the information disclosure function of the board secretary, executives with real power concurrently serve as the CFO and board secretary in many listed companies. As the producers of financial reports in listed companies, CFOs affect the quality of financial statements [7]. Thus, CFOs directly affect the financial statement comparability of listed companies.

Conclusion

Using the data of Chinese A-share listed firms from 2007 to 2021, this study investigates the effect of a CFO also serving as board secretary on financial statement comparability. The results show that a CFO who is also board secretary improves a firm’s financial statement comparability. Given that managers’ personal characteristics play a role in financial statement comparability, we investigate the effects of the personal characteristics of a CFO who also serves as board secretary on a firm’s financial statement comparability. Our results generally suggest that financial statement comparability is positively associated with a CFO who is female, is middle-aged, has a higher education level, and has a financial background. A CFO who serves as board secretary can shorten the information transmission chain within a firm, reducing information loss and improving financial statement comparability. This study provides evidence that a CFO serving as board secretary plays an important role in financial statement comparability. Listed firms should encourage CFOs to also serve as board secretaries, and appropriate consideration should be given to the selection of female middle-aged executives with higher education and a financial background for this role. In addition, investors should also consider a senior executive’s personal characteristics to make the most appropriate decisions possible. This study contributes to the internal governance of listed companies, as well as to the hiring of a CFO with any kind of personal characteristics, giving more references and assistance to the company and more benefits to the comparability of financial reports. To the extent that it helps listed companies to establish a good image in the capital market.