Evidence of Asset Impairment Reversals from China: Economic Reality or Earnings Management?

2007 ◽  
Author(s):  
Shimin Chen ◽  
Yuetang Wang ◽  
Ziye Zhao
Keyword(s):  
Earnings Management ◽  
Asset Impairment ◽  
Economic Reality

Changes in Accounting Estimates: Underlying Economic Reality or Earnings Management

2018 ◽  
Author(s):  
Al (Aloke) Ghosh ◽  
Subprasiri Siriviriyakul
Keyword(s):  
Earnings Management ◽  
Accounting Estimates ◽  
Economic Reality

Channel-Stuffing Reinvented: Earnings Management in Toshiba's Personal Computers Division

2020 ◽  
Vol 35 (3) ◽  
pp. 25-38
Author(s):  
Mahendra R. Gujarathi ◽  
Amitabh Dugar
Keyword(s):  
Earnings Management ◽  
Financial Reporting ◽  
Financial Statements ◽  
Personal Computers ◽  
Top Management ◽  
Graduate Level ◽  
Introductory Accounting ◽  
Accounting Courses ◽  
Economic Reality ◽  
Channel Stuffing

ABSTRACT This case describes how Toshiba, a well-known Japanese conglomerate, creatively used the technique of channel-stuffing to inflate its earnings by $478 million during 2008–2014. Students evaluate the uniqueness of Toshiba's practice of channel-stuffing, determine whether Toshiba's financial statements faithfully depicted the economic reality of underlying transactions, and understand the spiraling effects of channel-stuffing on reported profits. Students also learn that the responsibility for integrity in financial reporting lies not just with the top management, but also with the junior employees. The case requires an understanding of only basic accounting concepts and can be used in a variety of courses, especially in the M.B.A. introductory accounting course, and in the intermediate accounting courses at the undergraduate or graduate level.

R&D Capitalization and Reputation-Driven Real Earnings Management (Partially Retracted)

2010 ◽  
Vol 85 (2) ◽  
pp. 671-693 ◽  
Author(s):  
Nicholas Seybert
Keyword(s):  
Research And Development ◽  
Earnings Management ◽  
Negative Impact ◽  
Real Earnings Management ◽  
Future Prospects ◽  
Positive Image ◽  
Asset Impairment ◽  
External Reporting ◽  
D Investment

ABSTRACT: Prior research finds that mandatory expensing induces underinvestment in research and development (R&D). The current study investigates whether capitalization can also create R&D investment problems. Abandoning a capitalized project requires asset impairment, a negative reporting effect that could damage managers' reputations. In an experiment utilizing M.B.A. student participants, I find that managers responsible for initiating an R&D project are more likely to overinvest when R&D is capitalized. I show that high self-monitors (those most likely to alter their behaviors to convey a positive image) are most likely to overinvest, suggesting that reputation concerns contribute to this behavior. A follow-up survey reveals that, when R&D is capitalized, experienced executives anticipate overinvestment and expect project abandonment to have a stronger negative impact on the responsible manager's reputation and future prospects at their firm. The results suggest that managers are held responsible for the external reporting consequences of their projects, such that mandating R&D capitalization may not reduce real earnings management.

scholarly journals Zarządzanie wynikiem finansowym w przedsiębiorstwach spożywczych

2018 ◽  
Vol 18(33) (3) ◽  
pp. 67-79
Author(s):  
Michał Comporek
Keyword(s):  
Earnings Management ◽  
Empirical Research ◽  
Stock Exchange ◽  
Discretionary Accruals ◽  
Economic Situation ◽  
The Other ◽  
Private Benefits ◽  
Economic Practice ◽  
Warsaw Stock Exchange ◽  
Economic Reality

As the realities of economic practice show, the management of enterprise, seeking on to maximize their private benefits and on the other hand to meet the expectations of all company’ stakeholders, can take action to show the economic situation of the enterprise in a better light in the eyes of its investors, creditors, employees etc., rather than indicates the economic reality. These activities are reflected in the earnings management phenomenon. The main goal of the article is to examine the scale and directions of operations related to intentional earnings management in public food companies using the discretionary accruals ratio distinguished by: the Jones model, the Kang-Sivaramakrishnan model and the Yoon et al. model. Empirical research was carried out in a group of 21 public food companies listed on the Warsaw Stock Exchange in the years 2003-2016.

Regulatory Incentives for Earnings Management through Asset Impairment Reversals in China

2009 ◽  
Vol 24 (4) ◽  
pp. 589-620 ◽  
Author(s):  
Shimin Chen ◽  
Yuetang Wang ◽  
Ziye Zhao
Keyword(s):  
Earnings Management ◽  
Asset Impairment ◽  
Regulatory Incentives
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