| Summary: | 碩士 === 淡江大學 === 會計學系碩士班 === 94 === In a sample of firms listed in Russell 3000, we investigate the behavior of earnings management by discretionary accruals (DA) and non-operating assets (NOA) around earnings thresholds, including positive earnings, earnings of the same quarter in last year, and analysts’earnings forecast. Results indicate that managers tend to use DA to decrease (increase) earnings when pre-managed earnings are above (below) earnings thresholds. The bigger the difference between pre-managed earnings and threshold, the stronger the use of DA is. Results also reveal that managers realize gains by disposing NOA to increase earnings when pre-managed earnings are lower than thresholds. Again, the positive association between threshold difference and use of NOA holds in this case. Testing the endogenous relation between DA and NOA, we find, at least in part, a complementary (substitute) relationship between these two instruments when thresholds difference is big (small).
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