Do Managers Use Related Party Transactions for Earnings Management or Operating Efficiency?Evidence from Pre- and Post-IPOs

• Main Authors: CHANG,YI-REN, 張譯仁
• Other Authors: LIN,HSIU-FENG
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/s75ygb

碩士 === 東海大學 === 會計學系 === 104 === This paper investigates the relation of related party transactions (RPTs) with earnings management and operating efficiency between pre- and post-IPO. Most of research has found that RPTs having a significant correlation with earnings management. But some research indicates that RPTs improving firms’ operating performance. However, the research did not investigate both the relationship between earnings management and operating performance. Our samples are chosen from the firms traded on the Taiwan Stock Exchange from 2005 to 2014. To compare the differences between pre- and post-IPOs, research period is three years before and after the firms IPO. Results find that pre- and post-IPOs have a different relation between earnings management and operating efficiency. Management to avoid effecting firm's the quality of financial reporting before the IPO, and RPTs by investor concern. Pre-IPOs RPTs, not for manipulating earnings upward. After the firm public offering, the earnings pressure makes management to earnings management through related party sales. Post-IPOs related party purchases improve operating efficiency than pre- IPOs, increasing firm’s value. Both pre- and post-IPOs related party sales positive operating efficiency.