The Malaysian Listing Requirement Reforms and Earnings Management Practices of Public Listed Firms

2010 ◽  
Author(s):  
L. A. Sahlan
Keyword(s):  
Earnings Management ◽  
Management Practices ◽  
Listed Firms ◽  
Listing Requirement

scholarly journals Proposing a model for limiting earning management practices: The case of Jordanian listed firms

2016 ◽  
Vol 12 (3) ◽  
pp. 81-84 ◽  
Author(s):  
Dea’a Al-Deen Omar Al-Sraheen ◽  
Khalid Alkhatib
Keyword(s):  
Earnings Management ◽  
Management Practices ◽  
Political Influence ◽  
Earning Management ◽  
Political Connections ◽  
Ceo Duality ◽  
Listed Firms ◽  
Independent Variables ◽  
The Board Of Directors ◽  
Do So

The key objective of this paper is to propose a model for limiting earning management practices among manufacturing firms in Jordan. In order to do so, two independent variables are examined in this paper, namely, political influence and CEO Duality. Discretionary total accruals according to the modified Jones model (1991) was used in order to estimate the level of earnings management, which is the dependent variable. The sample comprised 64 companies for the financial year 2013. The results suggest that a positive and significant association existed among both political influence and CEO duality and earning management. This means that both independent variables exacerbated earnings management. Further research is required to determine what urgent legislation should be developed to restrict the presence of members who have political connections on the board of directors. Also, the need exists for the separation of roles of Chairman and CEO to ensure the independence and complying with the requirements of corporate governance.

scholarly journals Corporate Disclosure, Ownership Structure And Earnings Management: The Case Of French-Listed Firms

2015 ◽  
Vol 31 (4) ◽  
pp. 1493 ◽  
Author(s):  
Nadia Lakhal
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Ownership Structure ◽  
Management Practices ◽  
Corporate Disclosure ◽  
Minority Shareholders ◽  
Listed Firms ◽  
Good Corporate Governance ◽  
Management Measures ◽  
The Relationship

The purpose of this paper is to investigate the effect of corporate governance devices on earnings management for French-listed firms. Particularly, it examines the relationship between corporate disclosure practices, ownership structure features and earnings management by French managers. Results show that the relationship between earnings management measures and disclosure scores is negative suggesting that less transparent firms are likely to engage in earnings management practices. The findings also show that families, institutional investors and multiple large shareholders negatively influence earnings management, and hence, act as good corporate governance devices to limit managerial discretion. This paper shed light on the monitoring role of corporate disclosures and ownership structure in the French context where minority shareholders interests are less protected than in common law countries.

Earnings Management and Corporate Governance in Family Firms

2019 ◽  
pp. 127-153
Author(s):  
Elisabete Vieira ◽  
Mara Madaleno
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Audit Committee ◽  
Family Firms ◽  
Management Practices ◽  
Corporate Board ◽  
Listed Firms ◽  
Big 4 ◽  
Ownership Effect ◽  
And Control

Earnings management and corporate governance relationships are examined for a sample of 49 Portuguese listed firms considering an unbalanced panel for the period 2002-2017, using panel corrected standard errors models and considering the family ownership effect. Empirical findings reveal that there is a positive relationship between corporate board independence and earnings management and that the presence of women on board decreases earnings management practices. Results are consistent with the hypothesis that earnings management practices are lower in family firms than in non-family firms. Size, being audited by the Big 4 companies, return on assets, loss, and the existence of an audit committee on board influence positively earnings management, but leverage, age, and ownership control are negatively related to earnings management. Results indicate that further auditing and control is necessary for Portuguese listed companies leading to strict recommendations to be followed by policymakers regarding control of these firms.

scholarly journals Impact of Improved Corporate Governance and Regulations on Earnings Management Practices—Analysis of 7 Industries from the Indian National Stock Exchange

2021 ◽  
Vol 14 (10) ◽  
pp. 454
Author(s):  
Jose Joy Thoppan ◽  
Robert Jeyakumar Nathan ◽  
Vijay Victor
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Management Practices ◽  
Positive Impact ◽  
Stock Exchange ◽  
Accounting Standards ◽  
Discretionary Accruals ◽  
Manufacturing Firms ◽  
Listed Firms ◽  
The Impact

This study investigates discretionary earnings management practices, tracing the changes over the years in selected top performing and highly liquid listed Indian firms. It empirically measures the impact of corporate governance, financial legislation and global reporting standards on the firms’ earnings management practices. The study analyses a sample of 712 firm-year data comprising 89 listed Indian companies across 7 different sectoral indices of the National Stock Exchange of India (NSE) over 8 years (2011–2018). The Modified Jones model was used to compute Discretionary Accruals to measure Earnings Management based on data obtained using Bloomberg terminals. Statistical results and plots generated in Stata offer evidence that instances of earnings management have significantly reduced after the enactment of the Companies Act 2013 and the adoption of Indian Accounting standards which are converged with the IFRS. Findings suggest that services firms are engaging in relatively higher levels of earnings management compared to manufacturing firms. This study reveals the positive impact of improved corporate governance, regulation, and enforcement by significantly reducing the levels of earnings management among listed firms in India.

scholarly journals Good corporate governance and earnings management in Indonesian initial public offerings

2016 ◽  
Vol 13 (4) ◽  
pp. 558-565
Author(s):  
Tatang Ary Gumanti ◽  
Ari Sita Nastiti ◽  
Ayu Retsi Lestari
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Initial Public Offerings ◽  
Management Practices ◽  
Governance Mechanism ◽  
Public Offerings ◽  
Listed Firms ◽  
Good Corporate Governance ◽  
Corporate Governance Mechanisms ◽  
Corporate Governance Mechanism

This study investigates the relationship between corporate governance mechanisms and earnings management (as measured by discretionary current accruals) for Indonesian IPO firms. Previous studies have mainly focused on an examination of the effect of corporate governance on the earnings management of publicly traded firms, whilst this study examines newly listed firms. It employs a modified Jones model to measure earnings management as developed by Tykvova (2006). The hypothesis predicts that Indonesian IPO firms with good corporate governance will engage in less earnings management in the periods prior to the IPO year. The sample consists of 75 IPOs and the results show that the proportion of board of commissioners, public ownership, institutional ownership and managerial ownership constrain the extent of earnings management of IPO firms. This study contributes to the literature in showing that corporate governance mechanism is an important determinant in earnings management practices for Indonesian IPO firms.

scholarly journals Audit Committee Effectiveness and Earnings Management Among Publicly Listed Firms in Kenya

2020 ◽  
Vol 3 (2) ◽  
pp. 31-44
Author(s):  
Collins Kapkiyai ◽  
Josephat Cheboi ◽  
Joyce Komen
Keyword(s):  
Earnings Management ◽  
Audit Committee ◽  
Management Practices ◽  
Audit Committees ◽  
Financial Reports ◽  
Listed Firms ◽  
Financial Expertise ◽  
Financial Scandals ◽  
Practical Implications

Objective: The paper sought to investigate the role of an effective audit committee in controlling earnings management practices. Design / Methodology: A panel data sourced from the audited financial reports of firms listed at the Kenyan Nairobi Securities Exchange for the periods between 2004 and 2017 were analyzed using a panel regression model. Findings: Audit committee effectiveness proved an important monitoring mechanism for earnings management. The independence, Meeting frequency, and financial expertise of the audit committee evidenced a negative and significant effect on earnings management. Practical Implications: Firms need to ensure that their audit committees operate effectively. This is achieved through enhancing their independence, ensuring optimal meeting frequency, and a higher number of members with financial expertise for fewer earnings management. Originality: The paper suggests the ways through which audit committee effectiveness can be enhanced to reduce earnings management amid rampant global financial scandals.

scholarly journals Do Women On Boards And In Top Management Reduce Earnings Management? Evidence In France

2015 ◽  
Vol 31 (3) ◽  
pp. 1107 ◽  
Author(s):  
Faten Lakhal ◽  
Amal Aguir ◽  
Nadia Lakhal ◽  
Adnane Malek
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Management Practices ◽  
Gender Diversity ◽  
Top Management ◽  
Men And Women ◽  
Listed Firms ◽  
Management Positions ◽  
Women On Boards ◽  
The Relationship

<p>The purpose of this paper is to examine the effect of gender diversity on the boardroom and in top management positions on earnings management by French-listed firms. Based on a sample of 170 firms over 4 years, we find that the proportion of women on the board standing as a director or a chair reduces earnings management. This finding suggests that women are effective on their monitoring role and are then considered as a crucial corporate governance device. We also find that the relationship between the presence of at least three women on the board and earnings management is negative suggesting that by increasing the number of women on board through regulation and legislation, French firms are likely to enhance the effectiveness of the board to better detect earnings management. However, women standing in CEO and CFO positions do not affect earnings management practices. These findings suggest that efforts made by political bodies to promote equality between men and women on boards are beneficial for French-listed companies by limiting earnings management practices. However, regulating or imposing a quota of women on boards can create a temporal shortage of qualified women available to take up such positions.</p>

scholarly journals The influence of family board involvement on earnings management

2021 ◽  
Vol 18 (2) ◽  
pp. 106-123
Author(s):  
Fabio Franzoi ◽  
Mark Mietzner ◽  
Franziska Thelemann
Keyword(s):  
Earnings Management ◽  
Family Involvement ◽  
Family Firms ◽  
Management Practices ◽  
Real Earnings Management ◽  
Family Management ◽  
Family Ownership ◽  
Executive Board ◽  
Listed Firms ◽  
Founding Family

This study explores the influence of family ownership and family board involvement on earnings management in German-listed firms. We extend existing research by applying a more precise measurement of family involvement that offers new insights into a family’s effect on earnings management behaviour. Our models suggest that the degree of management involvement of families is a significant driver of earnings management, a factor disregarded so far in the literature. Furthermore, the distinction between founding family and family ownership should be carefully considered. Employing a sample of 278 firms from 2000-2013, we find that greater family management presence on the executive board is associated with more earnings-decreasing accrual-based earnings management practices and more real earnings management activities via discretionary expenses. This is viewed as less value-destroying REM activity to meet earning targets. Overall, German family firms seem to use their powerful positions as shareholders and executive board members to expropriate shareholders and manage earnings to meet targets while maintaining family wealth

scholarly journals The Impact of Financial Crisis on Earnings Management in Nonfinancial Listed Firms: Evidence from Jordan

2020 ◽  
Vol 15 (5) ◽  
pp. 168
Author(s):  
Yahia M. Al-Mughrabi
Keyword(s):  
Financial Crisis ◽  
Earnings Management ◽  
Management Practices ◽  
Global Financial Crisis ◽  
Discretionary Accruals ◽  
Ordinary Least Squares ◽  
Least Squares Regression ◽  
Listed Firms ◽  
Jones Model ◽  
The Impact

This paper studies earnings management in Jordan during the global financial crisis. It addresses mainly the question of whether or not financial crisis has an impact on discretionary accruals, using the modified Jones model (1995) for estimating discretionary accruals. By applying Ordinary Least Squares regression model on a sample of 71 nonfinancial listed firms during the period of 2005-2012, I find a conclusive evidence that Jordanian nonfinancial listed firms did not engage in a greater level of earnings management during the financial crisis period. In addition, larger firms are less involved in earnings management practices compared to smaller firms. Moreover, the results suggest a negative significant impact of operating cash flow on discretionary accruals, while it fails to connect current year losses with discretionary accruals. However, the findings indicate that firm&rsquo;s leverage is positively and significantly associated with discretionary accruals. Overall, the empirical results provided evidence that earnings management practices in Jordanian nonfinancial sectors are relatively small, even smaller in services sector, which raise questions about the validity of the modified Jones model and whether or not different models (such as Deangelo, 1986) should be used in future studies regarding earnings management.

scholarly journals Goodwill and accounting discretion

2015 ◽  
Vol 2 (10) ◽  
pp. 9
Author(s):  
Marco Bisogno
Keyword(s):  
Earnings Management ◽  
Management Practices ◽  
Discretionary Accruals ◽  
Financial Economic ◽  
Social Implication ◽  
Listed Firms ◽  
Goodwill Impairment ◽  
And Performance ◽  
Practical Implications

<p>Purpose: The aim of the paper is to investigate earnings management practices related to goodwill accounting, focusing on its first recognition as well as its write-offs, due to the impairment test.</p><p>Design/methodology/approach: The study refers to a sample of Italian listed firms and the analysis covers three years, with a total of 591 firm-year observations. The modified Jones’ regression model has been used in estimating discretionary accruals, as a proxy of earnings management practices.</p><p>Findings: A positive relationship between discretionary accruals and yearly changes in goodwill has been proved. Findings also show an incidence of leverage and performance.</p><p>Research limitations/implications: The study focuses on a single context (Italy) and it is essentially based on financial-economic variables.</p><p>Practical implications: Findings of the study could be relevant for standard-setters in future revisions of goodwill accounting.</p><p>Social implication: The study could support investors in evaluating the incidence of first recognition as well as goodwill impairment on the quality of earnings.</p>

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