| Summary: | 碩士 === 銘傳大學 === 會計學系碩士班 === 106 === This study explores the association among firm life cycle stages, real earnings management and future performance by using the publicly listed non-financial firms in Taiwan from 2009 to 2016 as the sample. The sample companies are split into growth, mature and decline stage based on Dickinson (2011) and data availability. Real earnings management is measured by a comprehensive indicator including abnormal operating cash flow, abnormal production costs and abnormal discretionary expenses based on Roychowdhury (2006). Following Nagar and Radhakrishnan (2016), this study identifies earnings management suspects by examining whether the sample companies tend to avoiding losses.
The study finds that firms in the growth and mature stages that just meet the earnings benchmark of avoiding losses do not exhibit real-activity based earnings management, and firms in the decline stages that just meet the earnings benchmark of avoiding losses exhibit real-activity based earnings management. In addition, for the decline-stage firms, real-activity based earnings management are negatively associated with future performance. This study recommends that the capital market should consider firm life cycle while identifying earnings management and evaluating their impacts on future performance.
|
|---|
