The influence of blockholders, bondholders and families on the venturers’ accounting behavior

Relying on the opportunistic view of contracting theory, the paper explores the influence of blockholders, bondholders and families on the managerial accounting for interests in jointly controlled entities. In particular, it assumes that the equity method is an opportunistic accounting choice as it improves firm performance and induces managerial self-dealing rather than efficient contracting. The paper examines a sample of Italian listed companies holding interests in jointly controlled entities through a logistic regression analysis. Findings show that the family influence encourages the opportunistic choice of equity method, while the monitoring role played by blockholders and bondholders discourages the use of the performance-improving technique. The research contributes to the literature on contracting theory and corporate governance and has also practical implications for evaluating the appropriateness of IFRS 11.