Work

Using partial least squares in archival accounting research: an application to earnings quality measuring

Year: 2019

Type: article

Abstract: Despite the advantages of Structural Equation Modelling (SEM) over regression models that have contributed to its popularisation in several fields of research in social sciences, it has not been broadly applied in archival accounting research. In this paper, we present a guidance for the application of SEM – and, particularly, the Partial Least Squares (PLS) method – to the (arguably) most recurrent topic on empirical archival accounting research: earnings quality. We highlight several problems that arise in earnings quality measuring, indicating how PLS can help to overcome them. We also run a simulation process whose results show that PLS method outperforms the other approaches even in situations of limited information.

Source: Spanish Journal of Finance and Accounting / Revista Española de Financiación y Contabilidad

DOI: 10.1080/02102412.2019.1608705

Authors: Ana Licerán-Gutiérrez, Manuel Cano-Rodríguez

Institution: Universidad de Jaén

Language: Spanish

Topic: Auditing, Earnings Management, Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: green

Funder: Universidad de Jaén

Awards: G2917432368, G7294841131