scholarly journals “Earnings Management” as a Factor for Underpricing Initial Public Offerings: Evidence from the Warsaw Stock Exchange

2016 ◽  
Vol 14 (4 (63)) ◽  
pp. 103-112 ◽  
Author(s):  
Rafał Cieślik ◽  
Keyword(s):  
Earnings Management ◽  
Initial Public Offerings ◽  
Stock Exchange ◽  
Public Offerings ◽  
Warsaw Stock Exchange

scholarly journals Earnings management and initial public offerings among Indonesian manufacturing companies

2021 ◽  
Vol 18 (3) ◽  
pp. 27-39
Author(s):  
Andreas ◽  
Enni Savitri ◽  
Tatang Ary Gumanti ◽  
Nurhayati
Keyword(s):  
Earnings Management ◽  
Initial Public Offerings ◽  
Stock Exchange ◽  
Financial Statements ◽  
Asia Pacific ◽  
Manufacturing Companies ◽  
Public Offerings ◽  
Industry Group ◽  
Manufacturing Sectors ◽  
Essential Chemical

Earnings management (EM) refers to the common use of accounting techniques in various economic settings, such as Initial Public Offerings (IPOs), to produce financial statements. This study, therefore, analyzes the effect of firm size, operating cash flow, the used IPO proceeds, earnings changes, and leverage on EM of manufacturing companies on the Indonesia Stock Exchange from 1989 to 2013. This sector comprises the essential chemical industry, miscellaneous organizations, and consumer goods, with 63 firms being used to meet the selection criteria. The regression analysis showed that the intended use of funds and leverage had a negative and significant impact on EM. Furthermore, the process is measured using Friedlan’s (1994) Discretionary Current Accruals model with similar results found in each industry group and their insignificant differences used to regulate the level of discretionary accruals between the three sectors. This study implies that the EM level is qualitatively similar among IPO companies in the three sub-sectors examined. AcknowledgmentsThe authors are grateful to the audience for their comments during the 11th Environmental and Sustainability Management Accounting Network-Asia Pacific (EMAN-AP) Conference held at the Danang University of Economics, Danang, Vietnam, 12-13 August 2019. The early draft was titled “Earnings Management and Initial Public Offerings on Manufacturing Sectors Companies”.

scholarly journals Earnings management, corporate governance, and ownership structure of Philippine initial public offerings

2021 ◽  
Vol 18 (4) ◽  
pp. 175-191
Author(s):  
Angelo O. Burdeos
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Initial Public Offerings ◽  
Ownership Structure ◽  
Stock Exchange ◽  
The Philippines ◽  
Ownership Concentration ◽  
Independent Directors ◽  
Ceo Duality ◽  
Public Offerings

Prior studies examined the effect of corporate governance variables on discretionary current accrual, the most widely used measurement of earnings management. The principal-agent conflict implies that the size of the board, the percent of independent directors, CEO duality, and auditor prestige limit discretionary current accruals (DCA). This paper extends past studies by examining the effect of ownership structure on discretionary current accruals. The study determines the level of income-increasing earnings management of initial public offerings (IPOs) in the Philippines and the factors that explain it. Particularly, the paper examines the effect of ownership concentration and largest shareholder ownership on discretionary current accruals. The study uses a final sample of 105 IPO firms in Philippine Stock Exchange (PSE) from 2008 to 2018. Employing the modified Jones’s (1991) model to measure discretionary current accrual and multiple regression analysis, the study finds -4.19% discretionary current accrual on the average. It also reveals that the 2002 Philippine Code of Corporate Governance (PCCG) is ineffective in curbing earnings management. In addition, there is an insignificant relationship between the size of the board, CEO duality, ownership concentration, largest shareholder ownership and auditor prestige, and earnings management. Furthermore, the paper finds a significant relationship between the percent of independent directors, industry sector, return on assets (ROA) and cash flow from operations and earnings management.

MANAJEMEN LABA PADA PERIODASEBELUM DAN SESUDAH PENAWARAN SAHAM PERDANA DI BURSA EFEK JAKARTA: ANALISIS DENGAN MODEL DEANGELO

2006 ◽  
Vol 2 (2) ◽  
pp. 67
Author(s):  
Elisa Indah ◽  
Erny Ekawati
Keyword(s):  
Real Estate ◽  
Earnings Management ◽  
Initial Public Offerings ◽  
Stock Exchange ◽  
Operating Performance ◽  
Discretionary Accruals ◽  
Building Construction ◽  
Financial Statement ◽  
Public Offerings ◽  
Industrial Group

The previous research fotmd empirical evidence about existence of earnings monagement of suuraunding IPO (Initial Public Offerings). Previous reseqrch also found that operating performance at period after IPO less than before IPO. The purposes of this research is to reexamine earnings management surrounding IPO and association earnings manog"*"it surrotmding IPO with the operating performance in Indonesiancapital market.This study uses the companies data conducting IPO on 88 /irms that went at Jakarta Stock Exchange for the periods 1995-2002. Company do not the included in industrial group of property, real estate and building construction, and industrial group of finance. The method used toexamine eantings management are the method that develop by DeAngelo.Ihe result of this study by using t-test is fomd that firms manage theiremnings to increqse reported income before IPO and after IPO. It meansthat IPO issuers make income increasing discretionary accruals in thefmancial statement before IPO and in the financial statement afier IPO.In this study by using double regression examination also found thatoperoting performance after IPO less than before IPO. This conditionis consequence firms conduct earnings managetnent before IPO untilhappen underperformance after IPO.Keywords z IPO, earnings management, income increasing discretionaryaccruals, operating performance, DeAngelo model.

scholarly journals Factors Influencing IPO Decisions. Do Corporate Managers Use Market and Corporate Timing? A Survey

2014 ◽  
Vol 42 (1) ◽  
pp. 30-39 ◽  
Author(s):  
Adam Szyszka
Keyword(s):  
Initial Public Offerings ◽  
Stock Exchange ◽  
Going Public ◽  
Public Offerings ◽  
Corporate Managers ◽  
Market Mispricing ◽  
Corporate Decisions ◽  
Factors Influencing ◽  
Warsaw Stock Exchange ◽  
Do So

Abstract This paper explores the motives for Initial Public Offerings (IPOs); that is, whether market mispricing or the behavioral inclinations of investors and analysts impact corporate decisions about rising equity, with a particular focus on market and corporate timing practices of managers going public. To do so, an anonymous survey was conducted of 166 managers of firms that recently went public at the Warsaw Stock Exchange in Poland (being the second most active IPO market in Europe, after London). The resulting data reveals that managers attempt to time bullish markets and good historical corporate financial results.

scholarly journals Motives and effects of the initial public offerings on the Warsaw Stock Exchange

Equilibrium ◽  
2015 ◽  
Vol 10 (2) ◽  
pp. 207
Author(s):  
Tomasz Sosnowski
Keyword(s):  
Initial Public Offerings ◽  
Initial Public Offering ◽  
Stock Exchange ◽  
Market Value ◽  
Public Offerings ◽  
Warsaw Stock Exchange ◽  
Business Efficiency ◽  
Secondary Shares ◽  
Public Offering

This paper empirically investigates the links between the motives for going public and changes in the market value and efficiency of new stock companies. Using a sample of 200 firms from Warsaw Stock Exchange between 2005 and 2012 I find that the principal purpose of initial public offering is raising additional capital by the company but divestment grounds of initial shareholders are also important. I find evidence that the sale of secondary shares in the initial public offering may be seen as a negative signal at aftermarket performance of the firm. The data reveal that the most adverse long-term changes in the market value and business efficiency are observed for those companies, where in the initial public offering both primary and secondary shares were sold.

scholarly journals IPO UNDERPRICING AND FINANCIAL ANALYSTS’ FORECAST ACCURACY IN POLAND

2015 ◽  
Vol 1 (310) ◽  
Author(s):  
Przemysław Pomykalski ◽  
Maciej Domagalski
Keyword(s):  
Initial Public Offerings ◽  
Stock Exchange ◽  
Financial Analysts ◽  
Forecast Accuracy ◽  
Ipo Underpricing ◽  
Public Offerings ◽  
Warsaw Stock Exchange

We review the theory and evidence on IPO activity and underpricing focusing on the Warsaw Stock Exchange and confirm that many IPO phenomena in Poland are not stationary. Focusing on the behavioural reasons for underpricing, we investigate the accuracy of analysts’ valuations made prior to initial public offerings. Using a unique set of data, we find a disappointing lack of accuracy, not only in the results of valuations but also in the underlying forecasts of revenues. 

PENDETEKSIAN EARNINGS MANAGEMENT UNDERPRICING, DAN PENGUKURAN KINERJA PERUSAHAAN YANG MELAKUKAN KEBIJAKAN INITIAL PUBLIC OFFERINGS (IPO) DI INDONESIA (Studi Empires Pada Perusahaan Di BEI)

2007 ◽  
Author(s):  
Anita Anita ◽  
Fivi Anggraini
Keyword(s):  
Earnings Management ◽  
Initial Public Offerings ◽  
Sampling Method ◽  
Stock Exchange ◽  
Market Performance ◽  
Company Performance ◽  
Purposive Sampling ◽  
Public Offerings ◽  
And Performance ◽  
Testing Company

The purpose of research for to detect policy of earnings management to include of moment IPO, to detect phenomenon underpricing on first when share traded in market secunder, testing company performance pasta IPO and testing relation policy of earnings management, underpricing and company performance (finance performance and market performance). This research using secunder data from company executing IPO. Samples of this research using purposive sampling method As much 48 company conducting IPO in Indonesian Stock Exchange in research of during 6 year consisted of 3 year before HIO and 3 year after IPO, so that there is 288 unit analysis.Result from this research that mean, that company executing IPO of indication do policy of earnings management some year before moment IPO by playing component accruals, that company executing IPO experience of underpricing on first when share traded in market secunder, that company executing IPO experience of degradation of performance of finance and performance of market, and there is downhill tendency after IPO. The last if connected third the above phenomenon, in general the researcher cannot prove relation between policy earnings management, phenomenon underpricing, and the company market performance and finance performance conducting IPO.

scholarly journals Earnings forecasts errors in prospectuses: evidence from initial public offerings on the Warsaw Stock Exchange

Equilibrium ◽  
2017 ◽  
Vol 12 (2) ◽  
pp. 229 ◽  
Author(s):  
Anna Wawryszuk-Misztal
Keyword(s):  
Initial Public Offerings ◽  
Stock Exchange ◽  
Forecast Error ◽  
Value Added ◽  
Earnings Forecasts ◽  
Multiple Regression Model ◽  
Managerial Ownership ◽  
Forecast Horizon ◽  
Public Offerings ◽  
Warsaw Stock Exchange

Research background: Several studies investigated the issue of accuracy of earnings fore-casts disclosed in IPO prospectus because of its importance in the investor’s decisions. Disclosing earnings forecasts can reduce information asymmetry and encourage potential investors to buy offered shares. The accuracy of earnings forecasts, and especially its deter-minants, was explored by some researchers, but for Polish companies such studies have not been conducted.Purpose of the article: The first objective of this study is to examine the bias and accuracy of earnings forecasts disclosed in IPO prospectuses by Polish companies attempting to be listed on the main market of the Warsaw Stock Exchange. The second aim of this paper is to identify the relationship between the absolute fore-cast error employed as a measure of earnings accuracy and a number of company specific characteristics such as company’s size, leverage, forecast horizon, managerial ownership, number of shares offered to investors (in relation to total shares before IPO).Methods: The empirical analysis were conducted on a sample of 102 domestic companies that performed IPOs on the main market of the Warsaw Stock Exchange during 2006-2015 and disclosed earnings forecasts in IPO prospectus. The forecast error (FER) and absolute forecast error (AFER) were adopted as a measure of accuracy of earnings forecasts. The non-parametric test was employed to achieve the adopted aims.Findings & Value added: The results show that, on average, the forecasted earnings exceed the actual earnings (i.e. the earnings forecasts are optimistic) and fore-casts are inaccurate. Moreover, the optimistic forecasts are more inaccurate than pessimistic ones. The findings of multiple regression model show that three independent variables may affect the level of absolute forecast error: the company’s size, managerial ownership and forecast horizon.

scholarly journals REASSESSING POLISH IPO UNDERPRICING AND UNDERPERFORMANCE

2015 ◽  
Vol 1 (310) ◽  
Author(s):  
Joanna Lizińska ◽  
Leszek Czapiewski
Keyword(s):  
Initial Public Offerings ◽  
Stock Exchange ◽  
Abnormal Returns ◽  
Ipo Underpricing ◽  
Public Offerings ◽  
Warsaw Stock Exchange ◽  
The Difference ◽  
Term Performance ◽  
Long Term Studies

The purpose of the research was to assess the price behavior of initial public offerings (IPO) of equities listed on the Warsaw Stock Exchange from 1996 to 2010. We also aimed to observe IPO underpricing and the underperformance phenomenon with different approaches. Short-term performance was analyzed with raw and adjusted initial returns. For the long-term, abnormal returns were compounded and cumulated. Different methods of outliers detection and ways of minimizing the detrimental effect of outliers were applied. In long-term studies, we also compared the results for the daily, weekly and monthly returns. IPO underpricing and underperformance on the WSE still remains substantial and significant, even accounting for the variety of methods applied. The difference in underpricing between the 1996–2004 and the 2005–2010 sample was insignificant. However, we reported statistically significant and economically important differences in underperformance between both samples.        

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