%0 Journal Article
	%A Yu-Chun Lin
	%D 2013
	%J International Journal of Economics and Management Engineering
	%B World Academy of Science, Engineering and Technology
	%I Open Science Index 78, 2013
	%T Why do Clawback Provisions Affect Financial Reporting Quality? - An Analysis of Trigger Effects
	%U https://publications.waset.org/pdf/5882
	%V 78
	%X We identify clawback triggers from firms- proxy
statements (Form DEF 14A) and use the likelihood of restatements to
proxy for financial reporting quality. Based on a sample of 578 U.S.
firms that voluntarily adopt clawback provisions during 2003-2009,
when restatement-based triggers could be decomposed into two types:
fraud and unintentional error, and we do observe the evidence that
using fraud triggers is associated with high financial reporting quality.
The findings support that fraud triggers can enhance deterrent effect of
clawback provision by establishing a viable disincentive against fraud,
misconduct, and otherwise harmful acts. These results are robust to
controlling for the compensation components, to different sample
specifications and to a number of sensitivity.
	%P 1430 - 1433