Motive behind Earnings Management Practices: Case in Public Property and Real Estate Companies in Indonesia

Kustono, Alwan Sri

doi:10.26740/jaj.v12n1.p49-64

Cited by 3 publications

(1 citation statement)

References 12 publications

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“…However, agents often have different goals, namely improving their welfare or opportunistic actions of managers such as increasing status and salaries and imposing these costs on the company. Acts of opportunism by managers charge the company, affecting the dividends distributed (Kustono, 2020).…”

Section: Introductionmentioning

confidence: 99%

Is There a Role for Earnings Management in Dividend Policy?

Kustono

Aspirandi

Varisa

2021

juara

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The study examines whether the dividend policy is affected by managerial ownership, free cash flow, or earnings management and the role of earnings management, such as mediating variables. Five hypotheses were tested with path analysis. Testing uses SmartPLS version 3.2.9. The population was the manufacturing companies in 2014-2018. The research period is limited to 2018 to avoid Covid 19 impact. There are 125 year-firms observations used to confirm the hypotheses. The result shows managerial ownership and free cashflows affect dividend policy and earnings management. Earnings management is not a mediating variable. This result rejects the previous research results, which concluded that earnings management influences dividend policy. The implication is earnings management is not a good explanation to see changes in dividend policy. Earnings management is challenging to plan dividend policy. Further researchers need to pay attention to the measurement of various types of earnings management that are more precise in management policies.

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Section: Introductionmentioning

confidence: 99%

Is There a Role for Earnings Management in Dividend Policy?

Kustono

Aspirandi

Varisa

2021

juara

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Sustainability Reporting and Earnings Management of Listed Non-Financial Firms in Nigeria

Olagunju,

Adenle,

Obademi

et al. 2023

Research Papers Faculty of Materials Science and Technology Slovak University of Technology

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The effects of sustainability reporting on earnings management was examined in the study extensively. Causal research design was employed in this study. The study population comprises of all the 112 quoted non-financial firms in Nigeria, sample size is 22 listed manufacturing firms purposively selected for the purpose of this study. The study covered 7 years’ period ranging from 2015-2021. The data used for this study were gotten from the annual reports and sustainability reports of the selected firms. Data used for this study were analyzed with the use of descriptive statistics and panel regression analysis. Sustainability reporting was measured in this study by using the social, economic and environmental disclosures index, whereas earnings management was measured using discretionary accrual and real earning. The outcome of the analysis of the study revealed that sustainability reporting has a significant negative effect on discretionary accruals and real earnings evidenced by t-statistics = (-2.31, -2.54, -2.95) and p-values of (0.037, 0.018 and 0.023) respectively for social, environmental and economic report disclosures on discretionary accruals and t-statistics of = (-2.53, -2.23, -2.86) and p-values of (0.012, 0.029 and 0.005) respectively for social, environmental and economic report disclosures on real earnings. The study concludes that the firms with low sustainability disclosure will probably be more involved in earnings management practices than the firms who actively disclosed their sustainability matters in details. The study recommends that firms should ensure they disclose in details the true state of their sustainability activities.

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The Impact of Corporate Social Responsibility on the Use of Earnings Management in the Context of Internal Financial and Macroeconomic Factors: The Case of Lithuania

Bachtijeva,

Tamulevičienė,

Subačienė

2024

Economies

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Earnings management is a widespread phenomenon in practice, with researchers therefore focusing on trying to understand what motives and factors lead to companies engaging in earnings management. In addition to internal financial and macroeconomic factors, the influence of institutional factors including corporate social responsibility (CSR) has been widely studied in recent years. In Lithuania, there have been no studies on the manipulation of accounting information in socially responsible companies. Therefore, this study aims to identify the impact of CSR on the application of earnings management in the context of internal financial and macroeconomic factors. The results of this study are significant as they not only enable assessing the impact of social responsibility on the application of earnings management in Lithuanian companies, but also the influence of macroeconomic factors such as the gross domestic product (GDP), inflation, foreign direct investment (FDI), average wages, and unemployment, as well as internal financial factors such as leverage, returns on assets (RoA), and the profitability of EBIT. The results show that CSR reduces the use of earnings management, regardless of whether it is accrual-based or real earnings management. Additionally, this analysis demonstrates that, among the internal financial factors, leverage carries the most substantial influence. The higher a company’s leverage, the more inclined that company is to use earnings management. Exploring the impact of macroeconomic indicators, it was found that the GDP, inflation, and unemployment rate have a statistically significant impact on the use of earnings management, albeit only if the firm uses accrual-based earnings management and adopts a profit-enhancing strategy.

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Motive behind Earnings Management Practices: Case in Public Property and Real Estate Companies in Indonesia

Cited by 3 publications

References 12 publications

Is There a Role for Earnings Management in Dividend Policy?

Is There a Role for Earnings Management in Dividend Policy?

Sustainability Reporting and Earnings Management of Listed Non-Financial Firms in Nigeria

The Impact of Corporate Social Responsibility on the Use of Earnings Management in the Context of Internal Financial and Macroeconomic Factors: The Case of Lithuania

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