| Summary: | 碩士 === 國立高雄應用科技大學 === 商務經營研究所 === 100 === The corporate net income is made based on accrual basis. However, the flexibility within accounting recognition gives managers certain control upon accruals, and thereby proceed earnings management to affect corporate net income. Such manipulation caused many financial frauds of companies recently.
According to research samples of 2000-2009, this research finds discretionary accruals were predictable for managers to influence future earnings. In addition, given further classification into discretionary current and non-current accruals, namely discretionary current accruals showed abundant information content on earnings management. Therefore, the research believes discretionary accounts receivable, accounts receivable, inventory and depreciation were the most relevant components frequently used for earnings management and information transmission. Among the four components, the inventory possessed notable influence to future corporate net income because most investors have differences in the degree of expertise of the financial statement and the inventory is likely to make most investors understand the abundant information. Meanwhile, the inventory provided good prediction for future stock returns.
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