Table 8 Interaction terms under...

Table 8

Interaction terms under generalised method of moments (GMM) estimation

Panel A: Actual ownership concentration (main results in Table 3)
	OWN = 1 for bottom quintile		OWN = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
OWN*BPS	0.523***	0.814***	1.297***	1.578***
	(0.001)	(<0.001)	(<0.001)	(<0.001)
OWN*EPS	−1.781	−2.694*	−7.421***	−7.914***
	(0.174)	(0.089)	(<0.001)	(<0.001)
With headline
OWN*BPS	0.307*	0.488***	1.368***	1.319***
	(0.061)	(0.010)	(<0.001)	(<0.001)
OWN*HEPS	0.501	0.911	−8.793***	−7.457***
	(0.716)	(0.561)	(<0.001)	(<0.001)
OWN*APS	−7.760***	−9.834***	−5.262	−17.705***
	(0.002)	(0.003)	(0.103)	(0.001)

Panel A: Actual ownership concentration (main results in Table 3)
	OWN = 1 for bottom quintile		OWN = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
OWN*BPS	0.523***	0.814***	1.297***	1.578***
	(0.001)	(<0.001)	(<0.001)	(<0.001)
OWN*EPS	−1.781	−2.694*	−7.421***	−7.914***
	(0.174)	(0.089)	(<0.001)	(<0.001)
With headline
OWN*BPS	0.307*	0.488***	1.368***	1.319***
	(0.061)	(0.010)	(<0.001)	(<0.001)
OWN*HEPS	0.501	0.911	−8.793***	−7.457***
	(0.716)	(0.561)	(<0.001)	(<0.001)
OWN*APS	−7.760***	−9.834***	−5.262	−17.705***
	(0.002)	(0.003)	(0.103)	(0.001)

Panel B: Abnormal ownership concentration (main results in Table 4)
	OWN = 1 for bottom quintile		OWN = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
OWN_AB *BPS	0.609***	1.318***	1.132***	1.160***
	(0.002)	(<0.001)	(<0.001)	(<0.001)
OWN_AB *EPS	−4.583***	−11.089***	−8.405***	−8.728***
	(0.005)	(<0.001)	(<0.001)	(<0.001)
With headline
OWN_AB *BPS	0.875***	1.057***	1.260***	1.097***
	(<0.001)	(<0.001)	(<0.001)	(<0.001)
OWN_AB *HEPS	−5.594***	−6.700***	−10.643***	−9.546***
	(0.001)	(0.004)	(<0.001)	(<0.001)
OWN_AB *APS	−2.822	−8.264***	−1.704	−3.021
	(0.317)	(0.008)	(0.628)	(0.523)

Panel B: Abnormal ownership concentration (main results in Table 4)
	OWN = 1 for bottom quintile		OWN = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
OWN_AB *BPS	0.609***	1.318***	1.132***	1.160***
	(0.002)	(<0.001)	(<0.001)	(<0.001)
OWN_AB *EPS	−4.583***	−11.089***	−8.405***	−8.728***
	(0.005)	(<0.001)	(<0.001)	(<0.001)
With headline
OWN_AB *BPS	0.875***	1.057***	1.260***	1.097***
	(<0.001)	(<0.001)	(<0.001)	(<0.001)
OWN_AB *HEPS	−5.594***	−6.700***	−10.643***	−9.546***
	(0.001)	(0.004)	(<0.001)	(<0.001)
OWN_AB *APS	−2.822	−8.264***	−1.704	−3.021
	(0.317)	(0.008)	(0.628)	(0.523)

Panel C: results where ownership concentration is closest to expectation (main results in Table 5)
	Abnormal ownership concentration and IFRS earnings		Abnormal ownership concentration and headline earnings
Variable	All firms	Positive earnings	All firms	Positive earnings
OWN_AB*BPS	−0.581***	−0.683***	−0.533***	−0.686***
	(0.002)	(0.001)	(0.003)	(0.001)
OWN_AB *EPS	5.183***	6.343***
	(0.001)	(0.001)
OWN_AB *HEPS			5.917***	7.394***
			(<0.001)	(<0.001)
OWN_AB *APS			−1.048	−0.245
			(0.773)	(0.952)

Panel C: results where ownership concentration is closest to expectation (main results in Table 5)
	Abnormal ownership concentration and IFRS earnings		Abnormal ownership concentration and headline earnings
Variable	All firms	Positive earnings	All firms	Positive earnings
OWN_AB*BPS	−0.581***	−0.683***	−0.533***	−0.686***
	(0.002)	(0.001)	(0.003)	(0.001)
OWN_AB *EPS	5.183***	6.343***
	(0.001)	(0.001)
OWN_AB *HEPS			5.917***	7.394***
			(<0.001)	(<0.001)
OWN_AB *APS			−1.048	−0.245
			(0.773)	(0.952)

Panel D: absolute abnormal ownership concentration (main results in Table 6)
	\|OWN_AB\| = 1 for bottom quintile		\|OWN_AB\| = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
\|OWN_AB\| *BPS	−0.470*	−0.310	0.918***	0.811***
	(0.066)	(0.266)	(<0.001)	(<0.001)
\|OWN_AB\| *EPS	5.216**	5.345**	−5.620***	−4.594***
	(0.015)	(0.028)	(<0.001)	(0.001)
With headline
\|OWN_AB\| *BPS	−0.448*	−0.496*	1.232***	0.865***
	(0.094)	(0.082)	(<0.001)	(<0.001)
\|OWN_AB\| *HEPS	6.218***	7.705***	−7.808***	−4.532***
	(0.006)	(0.002)	(<0.001)	(0.002)
\|OWN_AB\| *APS	0.959	−2.651	0.033	−4.684
	(0.832)	(0.613)	(0.991)	(0.267)

Panel D: absolute abnormal ownership concentration (main results in Table 6)
	\|OWN_AB\| = 1 for bottom quintile		\|OWN_AB\| = 1 for top quintile
Variable	All firms	Positive earnings	All firms	Positive earnings
With IFRS
\|OWN_AB\| *BPS	−0.470*	−0.310	0.918***	0.811***
	(0.066)	(0.266)	(<0.001)	(<0.001)
\|OWN_AB\| *EPS	5.216**	5.345**	−5.620***	−4.594***
	(0.015)	(0.028)	(<0.001)	(0.001)
With headline
\|OWN_AB\| *BPS	−0.448*	−0.496*	1.232***	0.865***
	(0.094)	(0.082)	(<0.001)	(<0.001)
\|OWN_AB\| *HEPS	6.218***	7.705***	−7.808***	−4.532***
	(0.006)	(0.002)	(<0.001)	(0.002)
\|OWN_AB\| *APS	0.959	−2.651	0.033	−4.684
	(0.832)	(0.613)	(0.991)	(0.267)

Note(s): Ownership concentration for this table was sorted into quintiles as described in the earlier tables. The dependent variable for all regression models is p. Results are from dynamic panel estimation with firm as the cross-sectional variable and year as the time variable. Given the number of instruments, estimation was made feasible by limiting the number of instruments to ten. Separate estimations for subsamples of firms that reported losses have been omitted from this table as estimations were rendered unfeasible in certain instances even when limiting the number of instruments to ten. Variables are defined in the Appendix. Two-tailed p-values are reported in brackets. ***, ** and * denote significance at the 1%, 5% and 10% levels respectively

Source(s): Authors’ own work

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