Relationship of Corporate Governance Affecting Window Dressing and Profitability in the Stock Exchange of Thailand in Resource Industry Groups

Abstract

         This research aimed 1) to study the relationship of corporate governance effecting window dressing in the stock exchange of Thailand in resource industry groups. And 2) to study the relationship of window dressing effecting profitability in the stock exchange of Thailand in resource industry groups. Is a quantitative research.  Collected using secondary information from the information in the financial statements, annual reports, and form 56-1 one report of each company from the website of the Securities and Exchange Commission of Thailand. The samples group is the listed companies in the stock exchange of Thailand in resource industry groups. In the criteria of 60 companies. Analyzed through multiple regression analysis to test the hypotheses.
         The research found that: 1) corporate governance as the level of corporate governance assessment had a negative correlation with the window dressing related to premature revenue recognition. The dual role of chairman and CEO had a negative correlation with the window dressing related to shifting future expenses to the current period. The proportion of independent directors and the frequency of board meetings had a significant positive correlation with window dressing related to profit increase through one-time items. The proportion of non-executive directors showed no correlation with window dressing. And 2) Window dressing as premature revenue recognition had a negative correlation with profitability in terms of net profit margin. Shifting future expenses to the current period had a positive correlation with profitability in terms of net profit margin statistically significant at the 0.05 level. Increasing profit through one-time items showed no correlation with profitability.