Table 2 Accrual earnings management,...

Table 2

Accrual earnings management, corporate social responsibility and future performance using the modified Jones model

	${ADJ_ROA}_{it + 1}$
	${ABS_DAC_MJ}_{it}$	${DAC_Positive_MJ}_{it}$	${DAC_Negative_MJ}_{it}$
${CSRI}_{it}$	−0.001	−0.004	0.005
${CSRI}_{it}$	[−0.129]	[−0.580]	[0.581]
${DAC_MJ}_{it}$	0.001	−0.001	−0.005*
${DAC_MJ}_{it}$	[0.927]	[−0.391]	[−1.943]
${CSRI}_{it} x {DAC_MJ}_{it}$	−0.013***	−0.012**	0.017**
${CSRI}_{it} x {DAC_MJ}_{it}$	[−3.090]	[−2.209]	[2.481]
${ROA}_{it}$	0.492***	0.462***	0.566***
${ROA}_{it}$	[24.860]	[19.685]	[14.468]
${SALES_GROWTH}_{i, t}$	−0.005***	−0.004*	−0.006*
${SALES_GROWTH}_{i, t}$	[−2.760]	[−1.935]	[−1.937]
${M / B}_{it}$	0.016***	0.021***	0.010***
${M / B}_{it}$	[7.357]	[7.424]	[3.009]
${Z_SCORE}_{it}$	−0.000	0.000	−0.004*
${Z_SCORE}_{it}$	[−0.506]	[0.201]	[−1.864]
${DUAL}_{it}$	−0.002	−0.004	−0.000
${DUAL}_{it}$	[−0.916]	[−1.143]	[−0.091]
${SIZE}_{it}$	−0.001	−0.002**	−0.001
${SIZE}_{it}$	[−1.511]	[−2.117]	[−0.690]
${AGE}_{it}$	0.001	0.001	0.000
${AGE}_{it}$	[1.261]	[1.567]	[0.580]
Constant	0.016	0.051	−0.003
Constant	[0.651]	[1.590]	[−0.065]
Observations	2,467	1,470	997
Year/Industry dummies	YES	YES	YES
Adjusted R²	0.315	0.336	0.270
F-value	68.32***	45.47***	23.39***

	${ADJ_ROA}_{it + 1}$
	${ABS_DAC_MJ}_{it}$	${DAC_Positive_MJ}_{it}$	${DAC_Negative_MJ}_{it}$
${CSRI}_{it}$	−0.001	−0.004	0.005
${CSRI}_{it}$	[−0.129]	[−0.580]	[0.581]
${DAC_MJ}_{it}$	0.001	−0.001	−0.005*
${DAC_MJ}_{it}$	[0.927]	[−0.391]	[−1.943]
${CSRI}_{it} x {DAC_MJ}_{it}$	−0.013***	−0.012**	0.017**
${CSRI}_{it} x {DAC_MJ}_{it}$	[−3.090]	[−2.209]	[2.481]
${ROA}_{it}$	0.492***	0.462***	0.566***
${ROA}_{it}$	[24.860]	[19.685]	[14.468]
${SALES_GROWTH}_{i, t}$	−0.005***	−0.004*	−0.006*
${SALES_GROWTH}_{i, t}$	[−2.760]	[−1.935]	[−1.937]
${M / B}_{it}$	0.016***	0.021***	0.010***
${M / B}_{it}$	[7.357]	[7.424]	[3.009]
${Z_SCORE}_{it}$	−0.000	0.000	−0.004*
${Z_SCORE}_{it}$	[−0.506]	[0.201]	[−1.864]
${DUAL}_{it}$	−0.002	−0.004	−0.000
${DUAL}_{it}$	[−0.916]	[−1.143]	[−0.091]
${SIZE}_{it}$	−0.001	−0.002**	−0.001
${SIZE}_{it}$	[−1.511]	[−2.117]	[−0.690]
${AGE}_{it}$	0.001	0.001	0.000
${AGE}_{it}$	[1.261]	[1.567]	[0.580]
Constant	0.016	0.051	−0.003
Constant	[0.651]	[1.590]	[−0.065]
Observations	2,467	1,470	997
Year/Industry dummies	YES	YES	YES
Adjusted R²	0.315	0.336	0.270
F-value	68.32***	45.47***	23.39***

Note(s): All test statistics and significance levels are computed using standard errors adjusted through a two-dimensional clustering approach at both the firm and year levels (Petersen, 2008). All variables are defined in Appendix 1. ***, ** and * denote statistical significance at the 1, 5 and 10% confidence levels, respectively. This table presents OLS regression results of Equation (5) as below

${ADJ_ROA}_{it + 1} = β_{0} + β_{1} {CSRI}_{it} x {ABS_DAC_MJ}_{it} + β_{2} {ROA}_{it} + β_{3} {SALES_GROWTH}_{i, t} + β_{4} {M / B}_{it} + β_{5} {Z_SCORE}_{it} + β_{6} {DUAL}_{it} + β_{7} {SIZE}_{it} + β_{8} {AGE}_{it} + \sum_{k} β_{k} {YEA R_{DUMMY}}_{it} + \sum_{j} β_{j} {INDUSTR Y_{DUMMY}}_{it} + ε_{it}$

Source(s): The table is created by authors

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