What motives shape the initial accounting for goodwill under IFRS 3 in a setting dominated by controlling owners?

References

• Adams, R. B., Hermalin, B. E., & Weisbach, M. S. (2010). The role of boards of directors in corporate governance: A conceptual framework and survey. Journal of Economic Literature, 48(1), 58–107. https://doi.org/10.1257/jel.48.1.58
   Web of Science ®Google Scholar
• Aktiebolagslagen. (2005). The Swedish Companies Act. Riksdagen.se. https://www.riksdagen.se/sv/dokument–lagar/dokument/svensk–forfattningssamling/aktiebolagslag–2005551_sfs–2005–551
   Google Scholar
• Alderson, K. J. (2011). Understanding the family business. Business Expert Press.
   Google Scholar
• Ali, A., Chen, T.-Y., & Radhakrishnan, S. (2007). Corporate disclosures by family firms. The Journal of Accounting and Economics, 44(1–2), 238–286. https://doi.org/10.1016/j.jacceco.2007.01.006
   Web of Science ®Google Scholar
• Aminadav, G., & Papaioannou, E. (2020). Corporate control around the world. The Journal of Finance, 75(3), 1191–1246. https://doi.org/10.1111/jofi.12889
   Web of Science ®Google Scholar
• Anderson, R. C., & Reeb, D. M. (2003). Founding family ownership and firm performance: Evidence from the S&P 500. The Journal of Finance, 58(3), 1301–1328. https://doi.org/10.1111/1540-6261.00567
   Web of Science ®Google Scholar
• André, P., Filip, A., & Paugam, L. (2016). Examining the patterns of goodwill impairments in Europe and the US. Accounting in Europe, 13(3), 329–352. https://doi.org/10.1080/17449480.2016.1260748
   Web of Science ®Google Scholar
• Barontini, R., & Caprio, L. (2006). The effect of family control on firm value and performance: Evidence from Continental Europe. European Financial Management, 12(5), 689–723. https://doi.org/10.1111/j.1468-036X.2006.00273.x
   Web of Science ®Google Scholar
• Bartov, E., Cheng, C. S. A., & Wu, H. (2021). Overbidding in mergers and acquisitions: An accounting perspective. Forthcoming in The Accounting Review.
   Google Scholar
• Bauguess, S., & Stegemoller, M. (2008). Protective governance choices and the value of acquisition activity. Journal of Corporate Finance, 14(5), 550–566. https://doi.org/10.1016/j.jcorpfin.2008.09.011
   Web of Science ®Google Scholar
• Beatty, A., & Weber, J. (2006). Accounting discretion in fair value estimates: An examination of SFAS 142 goodwill impairments. Journal of Accounting Research, 44(2), 257–288. https://doi.org/10.1111/j.1475-679X.2006.00200.x
   Web of Science ®Google Scholar
• Bertrand, M., & Schoar, A. (2006). The role of family in family firms. Journal of Economic Perspectives, 20(2), 73–96. https://doi.org/10.1257/jep.20.2.73
   Web of Science ®Google Scholar
• Billett, M. T., & Qian, Y. (2008). Are overconfident CEOs born or made? Evidence of self-attribution bias from frequent acquirers. Management Science, 54(6), 1037–1051. https://doi.org/10.1287/mnsc.1070.0830
   Web of Science ®Google Scholar
• Bugeja, M., & Loyeung, A. (2015). What drives the allocation of the purchase price to goodwill? Journal of Contemporary Accounting & Economics, 11(3), 245–261. https://doi.org/10.1016/j.jcae.2015.10.002
   Google Scholar
• Cai, Y., Kim, Y., Park, J. C., & White, H. D. (2016). Common auditors in M&A transactions. Journal of Accounting and Economics, 61(1), 77–99. https://doi.org/10.1016/j.jacceco.2015.01.004
   Web of Science ®Google Scholar
• Caprio, L., Croci, E., & Del Giudice, A. (2011). Ownership structure, family control, and acquisition decisions. Journal of Corporate Finance, 17(5), 1636–1657. https://doi.org/10.1016/j.jcorpfin.2011.09.008
   Web of Science ®Google Scholar
• Chen, S., Chen, X., & Cheng, Q. (2008). Do family firms provide more or less voluntary disclosure? Journal of Accounting Research, 46(3), 499–536. https://doi.org/10.1111/j.1475-679X.2008.00288.x
   Web of Science ®Google Scholar
• Claessens, S., Djankov, S., & Lang, L. H. (2000). The separation of ownership and control in east Asian corporations. Journal of Financial Economics, 58(1), 81–112. https://doi.org/10.1016/S0304-405X(00)00067-2
   Web of Science ®Google Scholar
• Cronqvist, H., & Nilsson, M. (2003). Agency costs of controlling minority shareholders. The Journal of Financial and Quantitative Analysis, 38(4), 695–719. https://doi.org/10.2307/4126740
   Web of Science ®Google Scholar
• de Bodt, E., Cousin, J. G., & Roll, R. (2018). Empirical evidence of overbidding in M&A contests. Journal of Financial and Quantitative Analysis, 53(4), 1547–1579. https://doi.org/10.1017/S0022109018000273
   Web of Science ®Google Scholar
• Demsetz, H., & Lehn, K. (1985). The structure of corporate ownership: Causes and consequences. Journal of Political Economy, 93(6), 1155–1177. https://doi.org/10.1086/261354
   Web of Science ®Google Scholar
• Detzen, D., & Zülch, H. (2012). Executive compensation and goodwill recognition under IFRS: Evidence from European mergers. Journal of International Accounting, Auditing and Taxation, 21(2), 106–126. https://doi.org/10.1016/j.intaccaudtax.2012.07.002
   Google Scholar
• Dhaliwal, D. S., Lamoreaux, P. T., Litov, L. P., & Neyland, J. B. (2016). Shared auditors in mergers and acquisitions. Journal of Accounting and Economics, 61(1), 49–76. https://doi.org/10.1016/j.jacceco.2015.01.005
   Web of Science ®Google Scholar
• Ding, Y., Richard, J., & Stolowy, H. (2008). Towards an understanding of the phases of goodwill accounting in four western capitalist countries: From stakeholder model to shareholder model. Accounting, Organizations and Society, 33(7-8), 718–755. https://doi.org/10.1016/j.aos.2007.07.002
   Web of Science ®Google Scholar
• Doukas, J. A., & Petmezas, D. (2007). Acquisitions, overconfident managers and self-attribution bias. European Financial Management, 13(3), 531–577. https://doi.org/10.1111/j.1468-036X.2007.00371.x
   Web of Science ®Google Scholar
• Dyck, A., & Zingales, L. (2004). Private benefits of control: An international comparison. The Journal of Finance, 59(2), 537–600. https://doi.org/10.1111/j.1540-6261.2004.00642.x
   Web of Science ®Google Scholar
• Faccio, M., & Lang, L. H. (2002). The ultimate ownership of Western European corporations. Journal of Financial Economics, 65(3), 365–395. https://doi.org/10.1016/S0304-405X(02)00146-0
   Web of Science ®Google Scholar
• Fernandes, N., Ferreira, M. A., Matos, P., & Murphy, K. J. (2013). Are U.S. CEOs paid more? New international evidence. Review of Financial Studies, 26(2), 323–367. https://doi.org/10.1093/rfs/hhs122
   Web of Science ®Google Scholar
• Financial Accounting Standards Board (FASB). (2001a). Statement of financial accounting standards no. 141. Business combinations, Norwalk, CT: FASB.
   Google Scholar
• Financial Accounting Standards Board (FASB). (2001b). Statement of financial accounting standards no. 142. Goodwill and other intangible assets, Norwalk, CT: FASB.
   Google Scholar
• Gallani, S., Krishnan, R., & Wooldridge, J. M. (2015). Applications of fractional response model to the study of bounded dependent variables in accounting research. Harvard Business School: Working paper 16-016.
   Google Scholar
• Goa, L., & Kling, G. (2008). Corporate governance and tunneling: Empirical evidence from China. Pacific–Basin Financial Journal, 16(5), 591–605. https://doi.org/10.1016/j.pacfin.2007.09.001
   Google Scholar
• Grinstein, Y., & Hribar, P. (2004). CEO compensation and incentives: Evidence from M&A bonuses. Journal of Financial Economics, 73(1), 119–143. https://doi.org/10.1016/j.jfineco.2003.06.002
   Web of Science ®Google Scholar
• Haleblian, J., & Finkelstein, S. (1999). The influence of organizational acquisition experience on acquisition performance: A behavioral learning perspective. Administrative Science Quarterly, 44(1), 29–56. https://doi.org/10.2307/2667030
   Web of Science ®Google Scholar
• Hamberg, M., & Beisland, L. A. (2014). Changes in the value relevance of goodwill accounting following the adoption of IFRS 3. Journal of International Accounting, Auditing and Taxation, 23(2), 59–73. https://doi.org/10.1016/j.intaccaudtax.2014.07.002
   Google Scholar
• Hamberg, M., Paananen, M., & Novak, J. (2011). The adoption of IFRS 3: The effects of managerial discretion and stock market reactions. European Accounting Review, 20(2), 263–288. https://doi.org/10.1080/09638181003687877
   Web of Science ®Google Scholar
• Harford, J., & Li, K. (2007). Decoupling CEO wealth and firm performance: The case of acquiring CEOs. The Journal of Finance, 62(2), 917–949. https://doi.org/10.1111/j.1540-6261.2007.01227.x
   Web of Science ®Google Scholar
• Holmén, M., & Knopf, J. (2004). Minority shareholder protections and the private benefits of control for Swedish mergers. Journal of Financial and Quantitative Analysis, 39(1), 167–191. https://doi.org/10.1017/S0022109000003938
   Web of Science ®Google Scholar
• Institutional Shareholder Services. (2007). Proportionality between ownership and control in EU listed companies. External study commissioned by the European Commission. http://www.ecgi.org/osov/documents/final_report_en.pdf
   Google Scholar
• International Accounting Standards Board (IASB). (2004). International Accounting Standard (IAS) No. 36: Impairment of Assets (revised). IASC Foundation Publications Department, London.
   Google Scholar
• International Accounting Standards Board (IASB). (2008). International Reporting Standard (IFRS) No. 3 Business combinations. IASC Foundation Publications Department, London.
   Google Scholar
• Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 303–360. https://doi.org/10.1016/0304-405X(76)90025-8
   Web of Science ®Google Scholar
• Johnson, L. T., & Petrone, K. R. (1998). Commentary: Is goodwill an asset? Accounting Horizons, 12(3), 293–303. https://doi.org/10.2307/2672938
   Google Scholar
• La Porta, R., Lopez-De-Silanes, F., & Shleifer, A. (1999). Corporate ownership around the world. The Journal of Finance, 54(2), 471–517. https://doi.org/10.1111/0022-1082.00115
   Web of Science ®Google Scholar
• Leuz, C., Nanda, D., & Wysocki, P. (2003). Earnings management and investor protection: An international comparison. Journal of Financial Economics, 69(3), 505–527. https://doi.org/10.1016/S0304-405X(03)00121-1
   Web of Science ®Google Scholar
• Li, K. K., & Sloan, R. G. (2017). Has goodwill accounting gone bad? Review of Accounting Studies, 22(2), 964–1003. https://doi.org/10.1007/s11142-017-9401-7
   Web of Science ®Google Scholar
• Loderer, C., & Martin, K. (1990). Corporate acquisitions by listed firms: The experience of a comprehensive sample. Financial Management, 19(4), 17–33. https://doi.org/10.2307/3665607
   Web of Science ®Google Scholar
• Malmendier, U., & Tate, G. (2008). Who makes acquisitions? CEO overconfidence and the market’s reaction. Journal of Financial Economics, 89(1), 20–43. https://doi.org/10.1016/j.jfineco.2007.07.002
   Web of Science ®Google Scholar
• Martin, K. (1996). The method of payment in corporate acquisitions, investment opportunities, and management ownership. The Journal of Finance, 51(4), 1227–1246. https://doi.org/10.1111/j.1540-6261.1996.tb04068.x
   Web of Science ®Google Scholar
• Maury, B. (2006). Family ownership and firm performance: Empirical evidence from Western European corporations. Journal of Corporate Finance, 12(2), 321–341. https://doi.org/10.1016/j.jcorpfin.2005.02.002
   Web of Science ®Google Scholar
• McDonald, M. L., Westphal, J. D., & Graebner, M. E. (2008). What do they know? The effects of outside director acquisition experience on firm acquisition performance. Strategic Management Journal, 29(11), 1155–1177. https://doi.org/10.1002/smj.704
   Web of Science ®Google Scholar
• McNichols, M. F., & Stubben, S. R. (2015). The effect of target-firm accounting quality on valuation in acquisitions. Review of Accounting Studies, 20(1), 110–140. https://doi.org/10.1007/s11142-014-9283-x
   Web of Science ®Google Scholar
• Miller, D., & LeBreton-Miller, I. (2005). Managing for the long run. Harvard Business School Press.
   Google Scholar
• Miller, D., Le Breton-Miller, I., & Lester, R. H. (2010). Family ownership and acquisitions behavior in publicly-traded companies. Strategic Management Journal, 31(2), 201–223. https://doi.org/10.1002/smj.802
   Web of Science ®Google Scholar
• Miller, D., Lee, J., Chang, S., & Le Breton-Miller, I. (2009). Filling the institutional void: The social behavior and performance of family versus non-family technology firms in emerging markets. Journal of International Business Studies, 40(5), 802–817. https://doi.org/10.1057/jibs.2009.11
   Web of Science ®Google Scholar
• Ramanna, K., & Watts, R. (2012). Evidence on the use of unverifiable estimates in required goodwill impairments. Review of Accounting Studies, 17(4), 749–780. https://doi.org/10.1007/s11142-012-9188-5
   Web of Science ®Google Scholar
• Roll, R. (1986). The hubris hypothesis of corporate takeovers. The Journal of Business, 59(2), 197–216. https://doi.org/10.1086/296325
   Web of Science ®Google Scholar
• Schatt, A., Doukakis, L., Bessieux–Ollier, C., & Walliser, E. (2016). Do goodwill impairments by European firms provide useful information to investors? Accounting in Europe, 13(3), 307–327. https://doi.org/10.1080/17449480.2016.1254348
   Web of Science ®Google Scholar
• Shalev, R. O. N., Zhang, I. X., & Zhang, Y. (2013). CEO compensation and fair value accounting: Evidence from purchase price allocation. Journal of Accounting Research, 51(4), 819–854. https://doi.org/10.1111/1475-679X.12015
   Web of Science ®Google Scholar
• Shleifer, A., & Vishny, R. W. (1997). A survey of corporate governance. The Journal of Finance, 52(2), 737–783. https://doi.org/10.1111/j.1540-6261.1997.tb04820.x
   Web of Science ®Google Scholar
• Swedish Corporate Governance Code (SCGC). (2016). http://www.corporategovernanceboard.se/UserFiles/Archive/496/The_Swedish_Corporate_Governance_Code_1_December_2016.pdf
   Google Scholar
• Tinaikar, S. (2017). Executive compensation disclosure and private control benefits: A comparison of US and Canadian dual class firms. Journal of International Accounting, Auditing and Taxation, 29, 32–51. https://doi.org/10.1016/j.intaccaudtax.2017.03.001
   Google Scholar
• Villalonga, B., & Amit, R. (2006). How do family ownership, control and management affect firm value? Journal of Financial Economics, 80(2), 385–417. https://doi.org/10.1016/j.jfineco.2004.12.005
   Web of Science ®Google Scholar
• Vural, D. (2018). Disclosure practices by family firms: Evidence from Swedish publicly listed firms. Accounting in Europe, 15(3), 347–373. https://doi.org/10.1080/17449480.2018.1479531
   Web of Science ®Google Scholar
• Watts, R. L. (2003). Conservatism in accounting part I: Explanations and implications. Accounting Horizons, 17(3), 207–221. https://doi.org/10.2308/acch.2003.17.3.207
   Google Scholar
• Yang, M. L. (2010). The impact of controlling families and family CEOs on earnings management. Family Business Review, 23(3), 266–279. https://doi.org/10.1177/0894486510374231
   Web of Science ®Google Scholar
• Yehuda, N., Vincent, L., & Lys, T. Z. (2019). The nature and implications of acquisition goodwill. Asian–Pacific Journal of Accounting & Economics, 26(6), 709–730. https://doi.org/10.1080/16081625.2017.1414615
   Web of Science ®Google Scholar
• Zhang, I. X., & Zhang, Y. (2017). Accounting discretion and purchase price allocation after acquisitions. Journal of Accounting, Auditing & Finance, 32(2), 241–270. https://doi.org/10.1177/0148558X15598693
   Web of Science ®Google Scholar