Voluntary Reporting Incentives and Reporting Quality: Evidence from A Reporting Regime Change for Private Firms in Taiwan
利用台湾2001年取消私营企业强制财务报告要求这一制度变更，发现自愿继续报告的企业比停止报告的企业财务报告质量更高，且这种质量差异降低了自愿报告企业的债务成本。
This paper examines the effect of voluntary financial reporting on firms' reporting quality using a reporting regime change in Taiwan. Before 2001, Taiwan's Company Act imposed a mandatory public reporting requirement of filing audited financial statements on private firms with contributed capital exceeding a certain threshold. This requirement was rescinded in 2001 and private firms since have had discretion over public financial reporting. We divide private firms retroactively into two groups: voluntary reporting firms, those continuing the practice of filing financial statements after the regime change; and nonvoluntary reporting firms, those discontinuing the reporting practice after the regime change. We find that financial reporting quality is higher for voluntary reporting firms than for nonvoluntary reporting firms and that this quality difference translates into a lower cost of debt for voluntary reporting firms. Our results support the view that reporting incentives play an important role in determining reporting quality.