Special section editorial: Enforcement of financial reporting.

This editorial introduces and assesses the collective contribution of three papers that collectively provide a special section of ABR on the topic of corporate financial reporting enforcement.[1] Empirically, the papers provide insights ranging from an analysis of the cross national impact of enforcement actions on the quality of corporate financial reporting in the banking sectors of 37 countries to detailed case studies of enforcement processes, outcomes and consequences in two contrasting institutional settings - namely, Romania and Italy - and covering, respectively, the development of a national Financial Reporting Enforcement System (FRES) and the institutional actions, interactions and silences concerning a controversial share revaluation in 2013 by the Bank of Italy. They comprise an appealing mix of a broad-based, cross-country analysis of the banking industry (which has not attracted a great deal of empirical attention in accounting archival research) and two detailed case studies of financial reporting enforcement processes. Duru et al. ([22]) study the comparative impact of enforcement regimes on the value relevance of earnings and common equity across the banking sectors of 37 major economies for the estimation window 1999-2012. There are also fundamental questions to ask as to whether the desired enforcement goal is for the development of more rigorous and stronger regulatory enforcement regimes and authorities, or whether the more effective of "enforcement" regimes could be ones where the systemic emphasis rests less on ever increasing levels of inspection and intrusion (to secure compliance with standards) and more on engendering an acceptance of responsibility; securing compliance through a spirit of enablement rather than a fear of punishment. [Extracted from the article]