Abstract:

The paper presents a review of the methods to measure financial reporting quality (FRQ) and the factors of corporate governance that influence it, together with characteristics of samples used in research. It aims to gather the most recent findings, which have not been described yet to the author's best knowledge. The results show firstly that the most used proxy for FRQ measurement is the earnings management models. However, it is not possible to find the single best method. Secondly, there is a large set of factors influencing FRQ investigated by different authors. Most of them focus on the company's board of directors' characteristics. Other factors are related to the audit committee, external audit, and other categories of corporate governance mechanisms. Understanding the possible relationships between different factors and FRQ, together with the knowledge of FRQ proxies, may help to design future research on this topic.