Earnings Management, Corporate Attributes and Market Conditions

• Main Authors: Bo-Ren Deng, 鄧博仁
• Other Authors: Chun-An LI
• Format: Others
• Language: zh-TW
• Published: 2010
• Online Access: http://ndltd.ncl.edu.tw/handle/42926704289725781562

碩士 === 雲林科技大學 === 企業管理系碩士班 === 98 === Because of the changes of market conditions and business operations, executive authorities usually manipulate earnings in order to affect the accuracy of financial statements. However, the main way for the external users to get the corporate information is to read its financial statements. As a result, asymmetric information exists. In this study, 185 listed companies in Taiwan were selected as research samples, and the research period was from March 2001 to March 2010. This study aimed to explore that if there was significant influence on the absolute value of discretionary accruals while the financial ratios of different corporate attributes are under different market conditions. The empirical findings of the study are as follows.T-test model was used to compare the market conditions of the peak and the bottom, and the result revealed the significant difference in the absolute value of discretionary accruals. According to the multiple regression analysis, there was a significant negative relevance between the P/B ratio and the absolute value of discretionary accruals. This finding implied that the low P/B ratio (value firms) had higher degree of earnings management. After dummy variables of market conditions were used, there was lower degree of earnings management in both the three months after the peak and three months before the bottom. According to corporate attributes, value firms revealed significant positive relevances among all financial ratios, and the highest degree of earnings management appeared three months before and after the peak. This showed value firms were more interested in earnings management than growth firms.