Based on the theory of planned behavior [Ajzen, I. (1991). The theory of planned behavior. Organizational Behavior and Human Decision Processes, 50(2), 179-211], we examine the factors influencing the decisions of accounting students in China concerning the certified public accountant (CPA) designation. Surveying 288 college accounting students, we find that genuine interest, perceived professional independence in the workplace and perceived difficulties in maintaining the certification all affect students' intentions to pursue the CPA credential. Expectations of better market opportunities for those with CPA and the influence of important professional referees also positively influence students' decisions to earn CPA qualification. By highlighting these factors that attract students to pursue CPA, this paper has important implications for the accounting educators and other stakeholders.KEY WORDS: Theory of planned behavior, CPA designation, logistic regression analysis

Purpose – The purpose of this paper is to understand the impact of tenure on earnings management. Design/methodology/approach – Analytical model; multivariate regression analysis. Findings – The paper predicts that managers are conservative in managing earnings when they first start to take top managerial positions, and then become aggressive in the next few years. Once they reach the maximum level of earnings management, they will become conservative again and report earnings less aggressively. This inverted U-shaped relationship between tenure and earnings management is confirmed by the data from the Chinese stock market. Research limitations/implications – It is based on China stock market data. Generalization of the research results to other countries is limited. Practical implications – With the knowledge of when earnings management is more likely to occur, regulators can set up policies targeting firms and managers with certain characteristics, instead of requiring observances from all firms and managers. This limited scope can greatly reduce the costs of preventing and identifying earnings management, while effectively maintaining the quality of earnings in the meantime. Social implications – This paper examines the earnings management behavior related to CEO tenure. It is hoped that the research results can improve the overall understanding of earnings management, then social wealth spent on preventing and identifying it could be reduced. Originality/value – It is an original work.

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PurposeThe purpose of this paper is to investigate the effect of operating cycle on the differential persistence of accruals and cash flow, and the market reaction to the different components of earnings across firms with various operating cycles.Design/methodology/approachBy examining the US public firms' earnings and the capital market reaction to different components of earnings, from 1964 to 1993, it is found that the longer the operating cycle, the lesser will be the persistent of accruals.FindingsThis result is consistent with Sloan's theory that the differential persistence of accruals is attributable to estimation errors in accruals. Moreover, the market efficiency test shows that the mispricing of accruals is greater for firms with longer operating cycle, indicating that investors fixate on earnings, while ignoring the persistence of accruals among firms with different earnings quality.Originality/valueThis paper adds to the growing literature that has begun to examine the factors affecting accrual persistence and accrual mispricing by indicating that the length of operating cycle can play a role. In addition, it provides fresh evidence that the market fixates on earnings, thus emphasizing the importance of contextual analysis of financial statement. Finally, it corroborates Sloan and Xie that estimation errors in accruals drive the lower persistence of accruals.