Prior literature has examined 10-K narrative thematic bias and financial graph distortion as two independent outcomes that might arise from managements' efforts at impression management. Largely unexplored is an analysis of narrative thematic bias and financial graph distortion as joint and interrelated outcomes that would arise if management coordinates both in the same 10-K report as part of an impression management strategy. We fill this void in the literature by using a simultaneous equation system to examine the joint relationship between narrative thematic bias and graph distortion in the 10-K filings of S&P 500 firms from 2014 to 2018. We draw upon Paivio's (1986) dual coding theory to predict a positive association between narrative thematic bias and financial graph distortion based on the insight that graph distortion helps reinforce the effects of thematic bias, and vice versa. Consistently, we find a simultaneous and positive relationship between thematic bias and graph distortion. Further, we find that this complementary relationship is more pronounced in firms with weak corporate governance and weak external monitoring. Our findings suggest that management may exploit the reinforcing effects of thematic bias and graph distortion to leave financial statement users with a more favorable impression of firm performance.

中文翻译：

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印象管理策略——会计叙事主题偏差与财务图表扭曲之间的关系


先前的文献已经将 10-K 叙事主题偏差和财务图表扭曲视为管理层在印象管理方面的努力可能产生的两个独立结果。如果管理层在同一份 10-K 报告中将两者作为印象管理策略的一部分进行协调，那么对叙事主题偏差和财务图表扭曲作为联合且相互关联的结果的分析基本上未被探索。我们通过使用联立方程系统来检查 2014 年至 2018 年标准普尔 500 强公司 10-K 文件中叙述主题偏差和图表失真之间的联合关系，填补了文献中的这一空白。我们借鉴了 Paivio（1986）的双重编码理论基于图表扭曲有助于强化主题偏见的影响这一见解，预测叙事主题偏见与金融图表扭曲之间的正相关关系，反之亦然。一致地，我们发现主题偏差和图表扭曲之间存在同时且正相关的关系。此外，我们发现这种互补关系在公司治理薄弱和外部监管薄弱的公司中更为明显。我们的研究结果表明，管理层可能会利用主题偏差和图表扭曲的强化效应，给财务报表使用者留下对公司业绩更有利的印象。