Tom Van Caneghem

University of Antwerp | UA · Accountancy and Finance

In this large-scale empirical study, we examine drivers of compliance with the first filing requirement for the Ultimate Beneficial Owners (UBO) register in Belgium, which results from the implementation of the 4th EU Anti-Money Laundering Directive. Our focus on nonprofit organizations (NPOs) is inspired by their strong objection against the UBO r...

We investigate the feasibility of machine learning methods for attributional content and framing analysis in corporate reporting. We test the performance of five widely-used supervised machine learning classifiers (naïve Bayes, logistic regression, support vector machines, random forests, decision trees) in a top-down three-level hierarchical setti...

At the time of introducing legally required disclosure of financial statements (FS) among Belgian nonprofit organizations (NPOs) in 2006, NPOs are found to increase their share of long-term and financial credit in total credit, relative to a control group of for-profits with unchanged disclosure requirements. Regarding FS format, NPOs filing the co...

Research on value relevance of reported selling, general and administrative expenses (SG&A) generally employs historical SG&A as reference point for assessment. This practice tends to ignore the interpretational ambiguity that surrounds the economics of SG&A expenditure and what it means for future profitability and firm value. Organizational theor...

This study examines the distribution of the current ratio among large Belgian nonprofit organizations (NPOs). A current ratio falling below one signals (potential) liquidity problems among different types of stakeholders. Consistent with managerial intervention to avoid the current ratio falling below one, we observe significantly more (fewer) obse...

This study empirically examines whether mandatory audit fee disclosure affects audit pricing and price competition in the private client segment of the Belgian audit market. We expect price competition between auditors to intensify after mandatory public disclosure of audit fees because transparency of audit fee information is likely to increase cl...

This study investigates whether firms engage in peer-based benchmarking in their decision-making regarding selling, general and administrative expenses (SG&A) for a large sample of U.S. listed firms. Peer-based comparison relates to comparing own performance against the performance of a meaningful reference group of other firms. SG&A are to a large...

We investigate whether social comparison of a firm’s reported selling, general and administrative (SG&A) expenses affects financial analysts’ information uncertainty (and their behaviour). Based on a sample of US firms, we examine whether similarity of a firm’s SG&A to an industry-specific peer-based benchmark (or social benchmark) is associated wi...

We investigate whether social comparison of a firm’s reported selling, general and administrative (SG&A) expenses affects financial analysts’ information uncertainty (and their behaviour). Based on a sample of US firms, we examine whether similarity of a firm’s SG&A to an industry-specific peer-based benchmark (or social benchmark) is associated wi...

We examine the joint effect of bidder and target information asymmetry and uncertainty on the payment consideration and subsequent wealth effects in a large sample of acquisitions with both listed and private targets. In line with a risk-sharing argument, we find that acquisitions of targets characterized by higher uncertainty are more likely to be...

This study examines economic consequences of auditor choice in the Belgian nonprofit (NP) setting, where the identity of both the audit firm and the audit partner is required to be disclosed. Specifically, we examine the influence of auditor choice in favor of an auditor with industry expertise on future contributions (being the sum of donations an...

Purpose This study investigates the association between individual auditor characteristics (gender, experience and sector expertise) and audit opinions in Belgian nonprofit organizations (NPOs). The purpose is to identify auditor characteristics that imply a better assurance of financial statement (FS) quality. FS quality is essential to enhance f...

In contrast to the extensive research on audit fees of for-profit companies, literature on nonprofit audit fees is limited. In this article, audit fee determinants are tested using a Belgian sample of nonprofits. We find that Big4 auditors charge fee premiums, and that nonprofit expert auditors charge lower fees when expertise is measured at audit...

In order to assess the accuracy of the figures reported in NPOs’ financial statements, I perform a digital analysis on Belgian non-profit organizations’ financial statements for accounting years 2007 up to 2012. Specifically, I compare observed frequencies for digits in the second-from-the-left position with expected frequencies based on Benford’s...

From 2006 onwards very large Belgian nonprofit organizations (NPOs) are legally required to appoint an external auditor. In this context we investigate whether auditor choice in favor of a sector expert, being a higher quality auditor, is associated with NPOs’ expectations regarding several auditor attributes. We find that NPOs are more likely to c...

This article examines financial statement filing lags among a sample of Belgian small firms. Our results indicate that around one-third of small firm financial statements are filed late (after the legal deadline), but that monetary sanctions could be an effective tool to encourage compliance with legal deadlines. Whereas the deadline and late filin...

In this paper, we empirically examine the relationship between the external financial statement audit and the method of payment across a sample of Belgian mergers and acquisitions between listed and private firms over the period 1997–2009. We investigate whether a Big N audit (at the target level) reduces the need for a contingent payment resulting...

Based on a sample of listed US firms over the period 2002 up to 2011, we study whether conformity to intra-industry benchmarks in reported SG&A (Selling, General and Administrative expenses) as a characteristic of a firm's cost behaviour, is associated with properties of analyst earnings forecasts (analyst forecast dispersion and analyst forecast a...

In the current study, we examine audit report lags (ARLs) among a large sample of Belgian non-profit organisations (NPOs). Doing so, we (i) add to the very recent, but rapidly growing literature on financial reporting and auditing in the non-profit sector; and (ii) test the generalisability of findings regarding the ARL from the for-profit sector t...

Based on a large‐scale survey, we explore auditor performance perceptions among a sample of Belgian non‐profits. In addition, we examine the relationship between (i) perceived auditor performance and client satisfaction with the auditor; and (ii) client satisfaction with and client loyalty towards the auditor. Moreover, we contrast the ability of t...

The recently introduced risk capital allowance in Belgium, which allows a notional interest deduction (to be denoted NID hereafter) on a firm’s adjusted equity for tax purposes, has mitigated the tax discrepancy between equity and debt financing. To our knowledge, we provide the first empirical study of the extent to which this regulation has resul...

We examine financial reporting lags among a large sample of Belgian non-profit organizations (NPOs). Doing so, we add to the literature on financial reporting and accountability in the non-profit sector. Next to drivers of the financial reporting lag that have been identified in prior studies based on private firms (e.g., delaying the disclosure of...

We test whether the amount and/or quality of financial statement information affects the financial structure of small and medium-sized enterprises (SMEs). Belgian SMEs are used, because there are important differences in disclosure and audit requirements among them. Consistent with the traditional view that asymmetric or incomplete information rest...

This study investigates the impact of the combining companies’ financial analyst coverage in mergers and acquisitions (M&As). We analyze both the payment consideration as well as the wealth effects. Our empirical results for a sample of 1762 M&A announcements during 1994-2011 show that target analyst coverage is negatively related to the probabilit...

In case of a takeover, the acquiring firm has to choose whether to retain the acquired firm’s incumbent auditor or to switch to its own auditor. In the current paper, we explore the drivers of auditor switching by the acquired firm after a takeover among a sample of Belgian takeovers. Employing binary probit regression analysis, we relate different...

Purpose This paper aims to study conformity tendencies in selling, general and administrative (SG&A) expenses reporting of US firms through an institutional lens. Design/methodology/approach The paper examines intra‐industry conformity in SG&A reporting over a ten‐year period among a sample of US firms. It measures conformity by comparing a firm's...

Purpose The purpose of this paper is to study the impact of intra‐industry conformity tendencies on dividend policy among a large sample of US firms. Design/methodology/approach The paper explores mimetic influences on dividend policy. Consistent with prior institutional research, the paper measures mimetic pressures as institutional prevalence or...

This study investigates auditor choice in Belgian nonprofit organizations from a behavioral perspective. We investigate whether auditor choice in favor of an auditor with a high (versus low) level of sector specialization is associated with the importance that nonprofit organizations attach to six auditor attributes: competence/integrity/deontology...

In contrast to the extant research on audit fees of for-profit companies, literature on nonprofit audit fees is scant. In this paper, audit fee determinants of previous research are tested in a nonprofit market that is characterized by a relatively low dominance of BIG4 auditors, low litigation risk, small nonprofit entities, high levels of subsidi...

Recent investigations suggest that research assessments are mainly based on publication counts and journal level and, hence, fail at capturing the multifaceted nature of research performance. Instead, some commentators indicate that focus on the article's contribution would stimulate a more polycentric approach to research. In the current study we...

Purpose The purpose of this paper is to study audit pricing and the Big4 fee premium in Belgium. While a number of studies have already explored these issues, the Belgian audit market provides an interesting setting to gain an additional insight into the pricing of audit services for many reasons (e.g. audit market concentration in Belgium is much...

In this paper we test whether the amount and/or quality of financial statement information affect the financial structure of Small and Medium Enterprises (SMEs). We explore this issue for Belgian SMEs because there are important differences in disclosure and audit requirements among them. Consistent with the traditional view that asymmetric or inco...

Belgium) c Lessius Hogeschool – Member of the K.U. Leuven Association, Antwerp (Belgium) In most scientific disciplines, a number of divergent and often highly specialized research areas are examined, which is reflected in substantial differences among journal scopes. Using the accounting literature as an example, we argue that this diversity in sc...

Prior studies (see e.g. [Rosch, E. (1975). Cognitive reference points. Cognitive Psychology, 7, 532–547]) indicate that multiples of ten serve as cognitive reference points with a view to perceiving and evaluating numbers. In order to explore whether managers set dividends per share (henceforth DPS) at or just above a cognitive reference point, we...

Prior research in marketing documents the prevalence of so-called psychological (or odd) pricing. Unlike earlier studies that focused on prices of professional vendors, we also consider prices of private vendors in our analyses. Relying on a sample of prices for second-hand cars and employing three alternative ways to bare the phenomenon, our resul...

In the current paper, we apply a citation analysis, a limited content analysis and an analysis of authorship to the first decade of the European Accounting Review (EAR). Based on results from our citation analysis, we conclude that EAR contributed to the advancement of accounting knowledge. In its first decade, EAR covered a wide variety of researc...

We examine a citation-based structural influence measure for a sample of 41 accounting journals. We also determine the journals' span of influence in the accounting discipline. Next, based on observed citation patterns, we identify sub-areas in the accounting literature using both hard and soft partitioning clustering techniques. Finally, we explor...

In deze bijdrage wordt aan de hand van een analyse van de verdeling van ondernemingsresultaten nagegaan of Belgische ondernemingen de door hen gerapporteerde resultaten sturen met het oog op het vermijden van een (klein) verlies en/of het voorleggen van een toename in het resultaat ten opzichte van het voorgaande boekjaar. Tal van studies (zie bv....

This paper provides a review of the empirical earnings management literature. In particular, it presents a review of the factors that induce and constrain earnings management through accounting decisions. The consequences of actual or assumed earnings management are also discussed. The far majority of the literature focuses on the Anglo-Saxon conte...

Previous studies (see, for example, Carslaw, 1988; Thomas, 1989; Niskanen and Keloharju, 2000; Kinnunen and Koskela, 2002; Van Caneghem, 2002) clearly suggest that public companies' managers tend to round up the first digit of reported earnings (i.e. for companies reporting profits). Based on a sample of listed UK companies and employing earnings r...

Several prior studies (see e.g. Burgstahler and Dichev, 1997; Degeorge, Patel and Zeckhauser, 1999; Gore, Pope and Singh, 2001; Holland and Ramsay, 2003) document statistically significant discontinuities in the distribution of reported earnings figures around certain targets (i.e. zero earnings, analysts' earnings forecasts and prior year's earnin...

Previous studies (see, for example, Carslaw, 1988; Thomas, 1989; Niskanen and Keloharju, 2000; Kinnunen and Koskela, 2002; Van Caneghem, 2002) clearly suggest that public companies' managers tend to round up the first digit of reported earnings (i.e. for companies reporting profits). Based on a sample of listed UK companies and employing earnings r...

Previous studies (Carslaw, 1988; Thomas, 1989; Niskanen & Keloharju, 2000) have shown that companies' managers tend to round-up the first digits of reported earnings (i.e. for companies reporting profits). According to Carslaw (1988), this type of behaviour is inspired by the existence of the so-called ‘$1·99’ phenomenon where a price of $1·99 is p...

The most common definition of efficient stock markets states that in such markets prices fully reflect all available information. This obviously implies that in order for a market to be deemed (semi-strongly) efficient, it should not be possible to earn abnormal returns using trading strategies based on publicly available accounting data. However,...