INFLUENCE OF INSTITUTIONAL OWNERSHIP ON EARNINGS QUALITY: EVIDENCE FOR FIRMS LISTED ON THE PAKISTAN STOCK EXCHANGE

Abdul Wahab Latif, Aysha Sami Latif, Fahad Abdullah

Abstract


Prior studies have shown that ownership structure of firms
affects their performance, decision making and earnings. Studies have
found that institutional owners are well informed, organized and
proactive as compared to other owners. In this study we empirically
examined the impact of institutional ownership on earnings quality
for the listed firms of the Pakistan Stock Exchange (PSX). The data of
200 non-financial listed firms from 2002 to 2014 is collected for this
study. The conceptual framework of Financial Accounting Standards
Board (FASB, 1980) is used to measure the earnings quality. The four
dimensions of earnings quality studied are: predictive value, neutrality,
timeliness and representational faithfulness. Results showed
institutional ownership is positively related with earnings quality.
Moreover, a greater level of institutional shareholding brings more
oversight and enhances earnings quality.


Full Text:

PDF

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.