| Summary: | 碩士 === 國立雲林科技大學 === 會計系研究所 === 100 === Prior studies suggest that there are two coexistent yet unlike to be mutually exclusive motives for managers’ real activities manipulation reporting: opportunistic earnings reporting hypothesis versus informative size-adjusting hypothesis. The former hypothesis suggests that strategic real activities manipulation deteriorates the earnings informativeness, then, decreases the value-relevance of earnings. Yet, the latter hypothesis argues that firms may seek to signal their future operating performance by way of real activities adjustment then increases the value-relevance of earnings. Thus, the association between real activities manipulation and earnings quality is called for further examination. Moreover, this study conjectures that the monitoring role of institutional investor can enhance the informative components of managerial real activities manipulation, in turn, improve the informativeness of accounting numbers. This study uses institutional investor’s ownership as an intermediary variable to proxy the informative components of real activities manipulating, then, examines the effect of real activities manipulation on the value-relevance of accounting numbers. The empirical results support the opportunistism earnings reporting hypothesis that the real activities manipulation is negatively (positively) associated with the value relevance of earnings (equity book value). Incorporating the role of institutional investors into consideration, it is found that the real activities manipulation accompanies with higher institutional investor’s ownership, the more value-relevance increases of earnings and equity book value. This study demonstrates some diagnostic checks and evidences the results are robust to the various specifications.
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