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Title
  • en A cross-country study on the relationship between financial development and earnings management
Creator
    • en Enomoto, Masahiro ja 榎本, 正博 ja-Kana エノモト, マサヒロ
    • NRID 1000070313921
    • en Kimura, Fumihiko
    • en Yamaguchi, Tomoyasu
Accessrights open access
Rights
  • en © 2017 John Wiley & Sons Ltd. This is the peer reviewed version of the following article: [Journal of International Financial Management & Accounting, 29(2):166-194, 2018], which has been published in final form at http://dx.doi.org/10.1111/jifm.12078. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving.
Subject
  • Other en accounting institution
  • Other en accrual-based earnings management
  • Other en financial development
  • Other en real earnings management
Description
  • Abstract en This paper investigates whether a country's level of financial development is associated with earnings management in an international setting. Financial development is likely to heighten the monitoring and scrutiny of accounting numbers because of strengthened investor protection laws and regulations as well as sophisticated market participants. Therefore, we first hypothesize that both accrual-based and real earnings management decrease with greater financial development. However, research shows that managers tend to apply real earnings management, instead of accrual-based earnings management, under strict accounting standards, regulations, and close auditor scrutiny. Thus, we explore the alternative hypothesis that accrual-based earnings management decreases but real earnings management increases along with higher financial development. We examine the relationship between financial development and both types of earnings management using 56,830 observations in 37 countries covering the period 2009-2012. The results indicate that both types of earnings management are more restrained under higher levels of financial development.
Publisher en Wiley
Date
    Issued2018-06 , Available2020-07-01
Language
  • eng
Resource Type journal article
Version Type AM
Identifier HDL https://hdl.handle.net/20.500.14094/90004950
Relation
  • isVersionOf DOI https://doi.org/10.1111/jifm.12078
Journal
    • PISSN 0954-1314
    • EISSN 1467-646X
      • en Journal of International Financial Management & Accounting
      • Volume Number29 Issue Number2 Page Start166 Page End194
File
Oaidate 2022-11-09