Informal institutions and managers’ earnings management choices: Evidence from IFRS-adopting countries

Halabi, Hussein; Alshehabi, Ahmad; Zakaria, Idlan

doi:10.1016/j.jcae.2019.100162

Cited by 33 publications

(28 citation statements)

References 80 publications

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“…Newest studies attempt to investigate qualitative issues such as the religious and cultural aspects associated with accounting and real activities manipulations. Halabi et al (2019), examine the effect of religiosity, the power-distance, and individualism accompanied by constructed formal institution variables (investor protection, enforcement quality, and equity market development) and a set of other control variables. The major findings tend to real earnings management methods in countries that religious and cultural factors have a significant impact on the management procedures.…”

Section: Issue 7: the Concentration Degree In The Marketmentioning

confidence: 99%

Earnings Management. An overview of the relative literature

Dokas¹,

Leontidis²,

Eriotis³

et al. 2021

Bulletin of Applied Economics

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This article aims to present a critical overview of the traditional studies in earnings management, focusing on the impact on the making decision process. This overview in the literature provides numerous aspects of this topic, in line with the firms' motivations. Earnings management procedure includes smoothing and opportunistic practices and illustrating accounting rules with a significant effect on accounting information quality. Several researchers have shifted their attention to real activities as a primary method or supplementary to accrual-based methods to obtain a complete view of the earnings management levels. Earnings management is considered an opportunistic instrument, and it can be part of the aggregate longterm business strategy. This review study provides some guidelines, to academics and professionals, in line with the models and the motivations that lead managers to engage in this procedure. This overview creates new research avenues enhancing the existing knowledge.

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Section: Issue 7: the Concentration Degree In The Marketmentioning

confidence: 99%

Earnings Management. An overview of the relative literature

Dokas¹,

Leontidis²,

Eriotis³

et al. 2021

Bulletin of Applied Economics

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show abstract

“…Nilai absolut akrual yang tingging lebih sering terjadi pada perusahaan dengan tingkat pertumbuhan yang tinggi. Perushaan yang memiliki pertumbuhan yang tinggi mempunyai insentif untuk mempertahankan tingkat pertumbuhannya yang tinggi dengan melakukan manajemen laba (Halabi, Alshehabi, and Zakaria 2019). Dalam penelitin ini pertumbuhan perusahaan diukur dengan price book value (PBV).…”

Section: Pertumbuhan Perusahaan (Growth)unclassified

Tingkat Kualitas Audit Perusahaan Keluarga Terhadap Tenur dan Rotasi Audit

Prabowo

Wibawa

2021

JAS

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The purpose of the research is to determine the influence of audit tenure and rotation on audit quality at the family businesses listed in the Indonesian Stock Exchange from 2009 to 2017, with the financial sector as the exemption. The reason for research is that the quality of the financial report is essential for decision-making purposes both internally and externally. This research is quantitative by utilizing secondary data. The analysis uses multiple regressions. The research showed that public accountants’ tenure and rotation have a positive impact but not significant on audit quality, where tenure and rotation on accounting firms have a negative impact but do not significantly influence audit quality.

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“…Literature also suggests two categories related to earnings management: Accruals-based Earnings Management or AEM and REM (Al-Haddad and Whittington, 2019;Gutiérrez and Rodríguez, 2019). While the former relates to accounting practices, the latter to the company's operating practices (Gutiérrez and Rodríguez, 2019;Halabi et al, 2019). Malikov et al (2018) found three earnings management tools in literature, Accruals-based Earnings Management, REM, and classification shifting.…”

Section: Literature Review and Research Questionsmentioning

confidence: 99%

Practices and mechanisms to mitigate the negative effects of accountingbased earnings management: An empirical study from the professionals’ perspective

Monteiro¹,

Accounting²

2021

Int. j. adv. appl. sci.

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Accounting conservatism and Accounting-based Earnings Management Practices (AEMP) introduce bias in financial information (FI), thereby influencing stakeholder behavior in the decision-making process. This study aims to analyze, from the certified accountants’ perspective, the AEMP in Portugal. Specifically, it analyses (1) the development of the AEMP and its impact on FI reporting, (2) the main hampered on its implementation, and (3) the need for the instruments and corporate governance mechanisms to mitigate the AEMP. Besides this research analyses (4) the relationship between the certified accountant’s characteristics (gender, age, professional experience, educational qualifications, and training area. To achieve the proposed objectives, we have used a quantitative methodological approach with a survey questionnaire, conducting an empirical study based on a sample of certified accountants. Based on a sample of 159 certified accountants, the results found that the majority of respondents indicate that Portuguese companies develop AEMP and that these practices have a negative and significant impact on the quality of financial statements (FS). Moreover, most certified accountants point out that is important to adopt measures that will prevent the abuse of AEMP and the main instruments for this are the establishments of more precise and concrete accounting standards and the application of the sanctions. The results also indicate that the audit committee and efficient internal control are corporate governance mechanisms AEMP able of mitigating the effects of the AEMP. Finally, the individual characteristics of certified accountants, such as professional experience, educational qualifications, and training area, significantly influence their perception of the need to mitigate the AEMP. This study presents relevant contributions to theory and practice. First, it develops the literature that evaluates AEMP, particularly in Portugal, where studies are scarce. Second, this study is original because it considers the relationship characteristics of accounting and AEMP professionals. Third, it allows entities that operate in accounting standardization and for accountants and FI users to have a more in-depth knowledge of the AEMP’s instruments and mechanisms.

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Informal institutions and managers’ earnings management choices: Evidence from IFRS-adopting countries

Cited by 33 publications

References 80 publications

Earnings Management. An overview of the relative literature

Earnings Management. An overview of the relative literature

Tingkat Kualitas Audit Perusahaan Keluarga Terhadap Tenur dan Rotasi Audit

Practices and mechanisms to mitigate the negative effects of accountingbased earnings management: An empirical study from the professionals’ perspective

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