Lobbying on Accounting Regulation: Evidence from the Oil Industry

Santos, Odilanei Morais dos; Santos, Ariovaldo dos

doi:10.1590/S1519-70772014000200004

Odilanei Morais dos Santos

Ph.D., Accounting Department of the Brazilian Capital Markets Institute, Rio de Janeiro. E-mail: odilaneisantos@terra.com.br

Ariovaldo dos Santos

Full Professor, Department of Accounting and Actuarial Science, School of Economics, Administration and Accounting, University of São Paulo. E-mail: arisanto@usp.br

	Formal Lobbying Methods	Informal Lobbying Methods
Direct Lobbying Methods	• Submission of public comment letters on proposed standards.	• Participation in private meetings or teleconferencing with Board members.
	• Participation in project groups as consultants.
	• Participation in public round-table discussions.
Indirect Lobbying Methods	• Submission of comments to members of the IFRS Advisory Council (formerly known as the Standards Advisory Council - SAC).	• Intermediation via an external auditor.
Indirect Lobbying Methods	• Submission of comments to the European Financial Reporting Advisory Group (EFRAG).	• Intermediation via associations.

Study	Objective
MacArthur (1988)	Investigate whether the submission of comments to the UKASB (on 28 proposals) is related to any economic issue (impact on accounting numbers) or political issue (political costs hypothesis).
Fogarty (1992)	Analyze the existence and operating process of the FASB using institutional theory.
Kenny and Larson (1993)	Investigate lobbying on the exposure draft regarding joint ventures.
Meier, Alam and Pearson (1993)	Investigate lobbying undertaken by audit firms on seven proposed standards affecting banks and savings and loan associations.
Tutticci, Dustan and Holmes (1994)	Understand the Australian standard-setting due process by performing content analysis of submissions on the exposure draft regarding intangible assets.
Weetman, Davie and Collins (1996)	Answer questions such as (a) Can the strategies of lobbyists be identified? (b) What are the possible reasons why non-lobbying companies do not submit comments?
Tandy and Wilburn (1996)	Investigate the participation of the academic community in the standard-setting process by analyzing letters submitted on the discussion memorandums and exposure drafts for SFAS 1-117.
Larson (1997)	Investigate the characteristics of respondents and analyze significant differences between lobbying companies and non-lobbying companies with regard to company size, country of origin of the respondents (13 countries) and listing on stock exchanges (U.S.)
McLeay, Ordelheide and Young (2000)	Examine the impact of lobbying activities on German accounting regulation with respect to the positions of preparers, auditors and scholars.
Hill, Shelton and Stevens (2002)	Investigate lobbying activities in the issuing process of SFAS 123 (Accounting for Stock-Based Compensation)
Larson (2002)	Establish a framework based on institutional theory for evaluating whether the Standing Interpretations Committee (SIC) has been effective and legitimate.
Georgiou (2004)	Analyze the effectiveness of lobbying during different stages of the regulatory process, i.e., earlier stages (formation of the discussion agenda of the board) and later stages (period of public consultation regarding the draft standard).
Georgiou (2005)	Capture the trend in lobbying strategy by companies over the long-term by analyzing a series of events (setting of several standards) over time.
Larson (2008)	Investigate whether political pressures rather than highly technical discussions decisively affected the issuance of SIC 12, which addresses the consolidation of special purpose entities. This study is grounded on institutional theory.
Chatham, Larson and Vietze (2010)	Analyze the comments submitted on the discussion paper regarding financial instruments to identify the main issues cited by respondents,in light of the fact that the European Union rejected full adoption of IAS 39, which in turn required additional effort by the IASB to reverse the situation. This study is grounded on institutional theory.
Georgiou (2010)	Investigate the nature and volume of participation by UK investment fund managers in the standard-setting process of the IASB during 2001-2006.
Stenka and Taylor (2010)	Understand the complexity of lobbying activities on four exposure drafts. Lobbyists are classified into two groups (corporate and non-corporate) and analyses are performed with the use of ANOVA and univariate regression.
Hansen (2011)	Provide evidence on how the IASB generates its standards in the presence of lobbyists with different preferences. Comment letters (629 letters) submitted during five public consultation organized by the IASB were used.
Larson and Kenny (2011)	Investigate the behavior of the IASB when issuing accounting standards regarding voluntary financial donations received from its constituents.
Bengtsson (2011)	Use institutional theory to investigate how the IASB responded to political pressure from the European Union following the global financial crisis as observed based on financial instrument standards.
Koh (2011)	Examine the characteristics of firms regarding the decision to lobby or not. For firms that submitted opinions on the FASB stock option standard, the study analyzed whether lobbying was for or against the standard under discussion.
Giner and Arce (2012)	Analyze the behavior of lobbyists based on institutional theory and evaluate lobbyists' influence on the decisions of the IASB regarding IFRS 2.
Tavares, Anjo, Paulo and Carter (2013)	Investigate the most frequent opinions submitted to the IASB/FASB regarding Revised Exposure Draft - Revenue from Contracts with Customers.
Matos, Gonçalves, Niyama, e Marques (2013)	Investigate whether standards with a higher level of inconsistency with local GAAPs were changed/approved in accordance with the geographical participation of the IASB board member.
Oliveira, Costa Júnior e Silva (2013)	Analyze the public consultation process of the accounting pronouncements committee (comitê de pronunciamentos contábeis - cpc) during 2007 to 2011. The study concludes that the cpc focused its efforts on obtaining maximum convergence with ifrs.

Binomial Logistic Regression		Poisson Regression
Binomial Logistic Regression		Extent of Favorability		Extent of Unfavorability
Code	Frequency	Code	Frequency	Code	Frequency
0	127	0	127	0	127
1	25	1	0	1	2
Multinomial Logistic Regression		2	3	2	2
Multinomial Logistic Regression		3	3	3	3
Code	Frequency	4	9	4	5
0	127	5	4	5	3
1	13	6	2	6	6
2	12	7	1	7	1
		8	2	8	3
		9	1	9	0
		10	0	10	0

Variable (in USD millions)	Mean	Median	Minimum	Maximum	Standard Deviation	KS Test p-value
NETREV	8.843	9.001	2.422	12.536	1.947	0.953
UPSTREAM	0.945	6.338	-20.720	10.083	11.550	0.000
AVPROF	12.787	12.719	1.596	20.703	4.009	0.994
TOTASS	9.520	9.603	4.378	12.694	1.579	0.984

Variable	Value "0"	Value "1"	Total
LOBBYING	127	25	152
LOBBYING	84%	16%	100%
COVENANT	41	111	152
COVENANT	27%	73%	100%
COMPGEN	40	112	152
COMPGEN	26%	74%	100%
METHOD	74	78	152
METHOD	49%	51%	100%
USLISTING	64	88	152
USLISTING	42%	58%	100%

	LOBBYING	NETREV	UPSTREAM	AVPROF	TOTASS	COVENANT	MANCOMP	METHOD
LOBBYING	1
NETREV	0,335 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	1
UPSTREAM	0,245 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	-0,004	1
AVPROF	0,422 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,767 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,363 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	1
TOTASS	0,400 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,894 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,269 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,882 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	1
COVENANT	0,070	-0,265 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,148	-0,203 ^* * (5%).	-0,194 ^* * (5%).	1
MANCOMP	0,104	-0,197 ^* * (5%).	0,084	-0,181 ^* * (5%).	-0,181 ^* * (5%).	0,445 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	1
METHOD	0,148	0,130	0,363 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,266 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,236 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,031	0,016	1
USLISTING	0,127	-0,236 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,226 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	-0,066	-0,155	0,412 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,489 ^ Note: LOBBYING: "0" if no comments were submitted and "1" if comments were submitted; NETREV: Net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: Average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance: (1%)	0,075

QUESTION # 1				QUESTION # 2				QUESTION # 3
Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total
18	2	5	25	9	10	6	25	11	13	1	25
72%	8%	20%	100%	36%	40%	24%	100%	44%	52%	4%	100%
QUESTION # 4				QUESTION # 5				QUESTION # 6
Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total
6	19	0	25	12	12	1	25	25	0	0	25
24%	76%	0%	100%	48%	48%	4%	100%	100%	0%	0%	100%
QUESTION # 7				QUESTION # 8				QUESTION # 9
Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total
14	9	2	25	13	11	1	25	6	19	0	25
56%	36%	8%	100%	52%	44%	4%	100%	24%	76%	0%	100%
QUESTION # 10				SUMMARY				MAINTENANCE OF THE STATUS QUO
Agrees	Disagrees	NA	Total	Agrees	Disagrees	NA	Total	YES	NO	NA	Total
1	23	1	25	115	118	17	250	107	39	4	150
4%	92%	4%	100%	46%	47%	7%	100%	71%	26%	3%	100%

$PROB ({LOBBYING}_{i}) = \frac{1}{1 + e - (α_{0} + β_{1 - 4} {TAMANHO}_{i} + β_{5} {COMPGEN}_{i} + β_{6} {COVENANT}_{i} + β_{7} {USLISTING}_{i} + β_{8} {METODO}_{i} + ε_{i})}$
Coef.	Variables	Expected Sign	Regression 1			Regression 2		Regression 3		Regression 4		Regression 5
Coef.	Variables	Expected Sign	Coef.	Sign.	VIF	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.
α	CONSTANT		-10.858	0.002	-	-7.408	0.000	-2.264	0.007	-7.905	0.000	-11.359	0.000
β₁	NETREV	+	-0.022	0.959	7.485	0.689	0.000****	-	-	-	-	-	-
β₂	UPSTREAM	+	0.047	0.452	1.881	-	-	0.173	0.097^* ** (5%)	-	-	-	-
β₃	AVPROF	+	0.348	0.023^ ***** (1%)	5.137	-	-	-	-	0.468	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:	-	-
β₄	TOTASS	+	0.258	0.590	10.857	-	-	-	-	-	-	1.019	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:
β₅	COVENANT	+	0.732	0.393	1.406	0.724	0.267	-0.017	0.978	0.767	0.262	0.731	0.280
β₆	MANCOMP	+	1.151	0.144 ^† * (10%)	1.483	0.671	0.340	0.494	0.475	1.208	0.109 ^† * (10%)	0.919	0.209
β₇	METHOD	+	-0.126	0.824	1.183	0.451	0.383	0.283	0.564	-0.029	0.958	0.164	0.762
β₈	USLISTING	+	0.209	0.744	1.522	0.553	0.347	0.261	0.653	0.255	0.676	0.376	0.534
Chi-Square Test			41.946	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:		28.833	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:	16.568	0.005^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:	40.553	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:	35.932	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. VIF: variance inflation factor test. Significance:
Nagelkerke R²				40.8%		29.2%		17.5%		39.6%		35.6%
"Correctly Predicted" Cases				76.3%		76.3%		59.9%		75.7%		77.6%
ROC Curve				86.9%		80.9%		81.2%		86.1%		84.5%
Number of Observations				152		152		152		152		152

$\begin{matrix} \ln = [\frac{PROB (LOBBYING = 1\| X)}{PROB (LOBBYING = 0\| X)}] = α_{1} + β_{1 - 4} {SIZE}_{i} + β_{5} {MANCOMP}_{i} + β_{6} {COVENANT}_{i} + β_{7} {USLISTING}_{i} + β_{8} {METHOD}_{i} + ε_{i} \\ \ln = [\frac{PROB (LOBBYING = 2\| X)}{PROB (LOBBYING = 0\| X)}] = α_{1} + β_{1 - 4} {SIZE}_{i} + β_{5} {MANCOMP}_{i} + β_{6} {COVENANT}_{i} + β_{7} {USLISTING}_{i} + β_{8} {METHOD}_{i} + ε_{i} \end{matrix}$
Coef.	Variables	Expected Sign.		Regression 6		Regression 7		Regression 8		Regression 9
Coef.	Variables	Expected Sign.		Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.
α	CONSTANT		Predominantly in Favor of DPEA	-6.952	0.002^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-3.360	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-8.285	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-10.010	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₁	NETREV	+		0.352	0.067^*	-	-	-	-	-	-
β₂	UPSTREAM	+		-	-	0.073	0.153	-	-	-	-
β₃	AVPROF	+		-	-	-	-	0.323	0.003^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-
β₄	TOTASS	+		-	-	-	-	-	-	0.639	0.012^**
β₅	COVENANT	+		0.838	0.341	0.485	0.581	0.952	0.281	0.869	0.321
β₆	MANCOMP	+		0.776	0.391	0.730	0.422	1.180	0.206	0.960	0.294
β₇	METHOD	+		0.433	0.481	0.152	0.808	-0.015	0.982	0.154	0.808
β₈	USLISTING	+		0.026	0.970	-0.365	0.599	-0.164	0.813	-0.054	0.938
α	CONSTANT		Predominantly Against of DPEA	-18.242	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-14.568	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-17.044	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-23.972	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₁	NETREV	+		1.394	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-	-	-	-	-
β₂	UPSTREAM	+		-	-	1.451	0.001^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-	-	-
β₃	AVPROF	+		-	-	-	-	0.801	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-
β₄	TOTASS	+		-	-	-	-	-	-	1.844	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₅	COVENANT	+		0.770	0.404	-0.270	0.772	0.800	0.411	0.775	0.434
β₆	MANCOMP	+		0.286	0.788	0.663	0.564	1.312	0.240	0.763	0.496
β₇	METHOD	+		0.276	7.488	-0.330	0.700	-0.154	0.859	0.057	0.951
β₈	USLISTING	+		1.212	0.257	1.027	0.438	0.858	0.412	1.126	0.313
Chi-Square Test				41.759	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	39.107	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	49.798	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	47.089	0.000^*** Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on the U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
Nagelkerke R²				35.6%		33.6%		41.4%		39.5%
"Correctly Predicted" Cases				84.9%		86.8%		86.8%		86.2%
Number of Observations				152		152		152		152

${LOBBYING}_{i} = \frac{μ^{LOBBYING} e - (α_{1} + β_{1 - 4} {SIZE}_{i} + β_{5} {MANCOMP}_{i} + β_{6} {COVENANT}_{i} + β_{7} {USLISTING}_{i} + β_{8} {METHOD}_{i})}{LOBBYING!} + u_{i}$
Panel A: Lobbying in Favor of DPEA
Coef.	Variables	Expected Sign.	Regression 10		Regression 11		Regression 12		Regression 13
Coef.	Variables	Expected Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.
α	CONSTANT		-5.089	0.002^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-1.892	0.314	-5.740	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-7.510	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₁	NETREV	+	0.373	0.007^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-	-	-	-	-
β₂	UPSTREAM	+	-	-	0.159	0.441	-	-	-	-
β₃	AVPROF	+	-	-	-	-	0.290	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-
β₄	TOTASS	+	-	-	-	-	-	-	0.589	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₅	COVENANT	+	0.551	0.378	0.150	0.773	0.624	0.284	0.602	0.320
β₆	MANCOMP	+	0.950	0.139 ^† * (10%)	0.952	0.159	1.271	0.035^ ***** (1%)	1.096	0.070^* ** (5%)
β₇	METHOD	+	0.182	0.707	-0.046	0.915	-0.224	0.648	-0.004	0.993
β₈	USLISTING	+	0.001	0.998	-0.243	0.603	-0.247	0.585	-0.146	0.757
Chi-Square Test			49.003	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	41.021	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	34.856	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	42.237	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
McFadden R²			13.2%		13.8%		23.4%		18.4%
Number of Observations			152		152		152		152
Panel B: Lobbying Against DPEA
Coef.	Variables	Expected Sign	Regression 14		Regression 15		Regression 16		Regression 17
Coef.	Variables	Expected Sign	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.
α	CONSTANT		-7.224	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-2.190	0.470	-6.844	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-10.139	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₁	NETREV	+	0.608	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-	-	-	-	-
β₂	UPSTREAM	+	-	-	0.232	0.537	-	-	-	-
β₃	AVPROF	+	-	-	-	-	0.373	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-	-
β₄	TOTASS	+	-	-	-	-	-	-	0.855	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
β₅	COVENANT	+	0.413	0.401	-0.214	0.701	0.377	0.404	0.390	0.423
β₆	MANCOMP	+	0.111	0.853	0.045	0.946	0.525	0.338	0.311	0.553
β₇	METHOD	+	0.278	0.536	0.282	0.528	-0.045	0.913	0.169	0.710
β₈	USLISTING	+	0.665	0.228	0.600	0.265	0.394	0.421	0.476	0.363
Chi-Square Test			25.343	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	45.651	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	23.623	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	19.001	0.000^* ***** (1%) Note: NETREV: net revenue for the period; UPSTREAM: exploration and development costs incurred in the period; AVPROF: average net profit for the last three periods; TOTASS: total assets for the period; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
McFadden R²			28.5%		16.5%		35.1%		33.9%
Number of Observations			152		152		152		152

		Binomial Logistic Regression		Multinomial Logistic Regression				Poisson Regression
		Binomial Logistic Regression		Predominantly in Favor of DPEA		Predominantly Against DPEA		Lobbying in Favor of DPEA		Lobbying Against DPEA
Variables	Expected Sign	Regression 18		Regression 19		Regression 20		Regression 21		Regression 22
Variables	Expected Sign	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.	Coef.	Sign.
CONSTANT		-1.379	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-3.601	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-4.643	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	-1.474	0.016^ (5%) ******* (1%)	-1.255	0.047^ (5%) ******* (1%)
SIZE	+	1.076	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	0.697	0.036^ (5%) ******* (1%)	1.446	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	0.445	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	0.595	0.000***
COVENANT	+	0.776	0.294	0.778	0.380	0.772	0.481	0.550	0.337	0.418	0.420
MANCOMP	+	0.884	0.251	0.904	0.326	0.672	0.571	0.949	0.141 ^† * (10%)	0.072	0.902
METHOD	+	0.280	0.594	0.367	0.554	0.059	0.946	0.119	0.801	0.196	0.678
USLISTING	+	-0.022	0.971	-0.301	0.663	0.592	0.594	-0.338	0.509	0.267	0.635
Chi-Square Test		30.194	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	38.492		0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:		50.017	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:	40.312	0.000^*** Note: SIZE: variable resulting from factor analysis, which is based on the values of the coefficients of the factor scores of each of the NETREV, UPSTREAM, AVPROF and TOTASS variables; COVENANT: "0" if no covenant is present and "1" if covenant is present; MANCOMP: "0" if no performance-based management compensation plan is present and "1" if performance-based management compensation plan is present; METHOD: "0" if company uses the full cost method and "1" if company uses the successful efforts method; USLISTING: "0" if company does not trades on U.S. stock market and "1" if company trades on the U.S. stock market. Significance:
Nagelkerke R²		30.5%		33.2%				-		-
McFadden R²		-		-				11.8%		25.1%
Number of Observations		152		152				152		152

Measures	Value	Communalities
		Variables	Initial	Extraction
Kaiser-Meyer-Olkin (KMO) Test		NETREV	1.000	0.878
Sample Adequacy	0.826	NETREV	1.000	0.878
		UPSTREAM	1.000	0.805
Bartlett's Sphericity Test		UPSTREAM	1.000	0.805
Chi-Square	607.017	AVPROF	1.000	0.864
df	6	AVPROF	1.000	0.864
Significance	0.000	TOTASS	1.000	0.896

Components	Initial Eigenvalues			Percentage of Explained Variance
Components	Total	% of Variance	% Accumulated	Total	% of Variance	% Accumulated
1	3.443	86.080%	86.080%	3.443	86.080%	86.080%
2	0.270	6.749%	92.829%
3	0.192	4.797%	97.627%
4	0.095	2.373%	100.000%

Factor Loadings		Matrix of Coefficients of Factor Scores
Variables	Component1	Variables	Component1
NETREV	0.937	NETREV	0.272
UPSTREAM	0.897	UPSTREAM	0.261
AVPROF	0.929	AVPROF	0.270
TOTASS	0.946	TOTASS	0.275

Medidas	Valor	Comunalidades
		Variáveis	Inicial	Extração
Teste Kaiser-Meyer-Olkin (KMO)		RECLIQ	1,000	0,878
Adequação da Amostra	0,826	RECLIQ	1,000	0,878
		UPSTREAM	1,000	0,805
Teste de Esfericidade de Bartlett		UPSTREAM	1,000	0,805
Qui-Quadrado	607,017	LUCMED	1,000	0,864
df	6	LUCMED	1,000	0,864
Significância	0,000	ATIVTOT	1,000	0,896

Componentes	Autovalores Inicial			Percentual de Variância Explicada
Componentes	Total	% de Variação	% Acumulado	Total	% de Variação	% Acumulado
1	3,443	86,080%	86,080%	3,443	86,080%	86,080%
2	0,270	6,749%	92,829%
3	0,192	4,797%	97,627%
4	0,095	2,373%	100,000%

Cargas Fatoriais		Matriz de Coeficientes dos Escores Fatoriais
Variáveis	Componente 1	Variáveis	Componente 1
RECLIQ	0,937	RECLIQ	0,272
UPSTREAM	0,897	UPSTREAM	0,261
LUCMED	0,929	LUCMED	0,270
ATIVTOT	0,946	ATIVTOT	0,275

[tfn01t15] Source: Orens, Jorissen, Lybaert and Tas (2011).

Lobbying on Accounting Regulation: Evidence from the Oil Industry1

Lobbying on Accounting Regulation: Evidence from the Oil Industry¹