Earnings management strategies in Brazil: Determinant costs and temporal sequence

• Cesar Medeiros Cupertino ^[2] ; Antonio Lopo Martinez ^[1] ; Newton C.A. da Costa Jr ^[2]
  1. [1] Fucape Business School

     Fucape Business School

     Brasil

     
  2. [2] Federal University of Santa Catarina, Brazil
• Localización: Contaduría y administración, ISSN 0186-1042, ISSN-e 2448-8410, Vol. 62, Nº. Extra 5, 2017, págs. 1460-1478
• Idioma: inglés
• DOI: 10.1016/j.cya.2016.11.002
• Títulos paralelos:
  • Estrategias de Gestión de Ingresos en Brasil: Costos Determinantes y Secuencia Temporal
• Enlaces
  • Texto completo (pdf)
• Dialnet Métricas: 4 Citas
• Resumen
  • español

    Este artículo describe un estudio que analiza las estrategias de manipuladoras de resultados que implican decisiones de contabilidad o actividades reales en Brasil. Se realiza un análisis de las relaciones entre las estrategias manipuladoras de resultados y los costos determinantes de la secuencia temporal en la que se aplican estas estrategias de manejo. Los resultados de las pruebas empíricas indican que la adopción de estrategias manipuladoras depende de sus costos relativos. Existe una relación temporal entre los dos tipos de estrategias para la manipulación de los resultados de fin de ano, ˜ con actividades reales anteriores opciones de contabilidad. También se observó que el nivel de manipulación por parte de las acumulaciones(actividades reales) reducción (aumento) después de la adopción de las IFRS en Brasil.

  • English

    This paper describes a study that analyses earnings management strategies involving accounting choices or real activities in Brazil. An analysis is conducted of the relationships between earnings management strategies their determinant costs and of the temporal sequence in which these management strategies are applied. The results of empirical tests indicate that adoption of management strategies is dependent on their relative costs. There is a temporal relationship between the two types of strategies for manipulation of year-end results, with real activities preceding accounting choices. It was also observed that the level of manipulation by accruals (real activities) reduced (increased) after adoption of the IFRS in Brazil.

• Referencias bibliográficas
  • Badertscher, B. (2011). Overvaluation and the choice of alternative earnings management mechanisms. The Accounting Review, 86(5), 1491–1518....
  • Barton, J. (2001). Does the use of financial derivatives affect earnings management decisions? The Accounting Review, 76(1), 1–26. http://dx.doi.org/10.2308/accr.2001.76.1.1
  • Barton, J., & Simko, P. (2002). The balance sheet as an earnings management constraint. The Accounting Review, 77(Suppl.), 1–27. http://dx.doi.org/10.2308/accr.2002.77.s-1.1
  • Bruns, W., & Merchant, K. (1990). The dangerous morality of managing earnings. Management Accounting, 72(2), 22–25.
  • Chen, Z. (2009). The choice between real and accounting earnings management. Houston: University of Houston (Ph.D. Thesis).
  • Cohen, D., Dey, A., & Lys, T. (2008). Real and accrual-based earnings management in the preand post-Sarbanes-Oxley periods. The Accounting...
  • Cohen, D., & Zarowin, P. (2008). Economic consequences of real and accrual-based earnings management activities. Stern School of Business,...
  • Cohen, D., & Zarowin, P. (2010). Accrual-based and real earnings management activities around seasoned equity offerings. Journal of Accounting...
  • Costa, P. (2012). Implications of IFRS adoption on book-tax conformity of Brazilian publicy-traded companies. São Paulo: University of São...
  • Cupertino, C. M., Martinez, A. L., & da Costa, J. C. (2015). Earnings manipulations by real activities management and investors’ perceptions....
  • Dechow, P., Kothari, S., & Watts, R. (1998). The relation between earnings and cash flows. Journal of Accounting and Economics, 25(2),...
  • Dechow, P., Sloan, R., Hutton, A., & Kim, J. (2012). Detecting earnings management: A new approach. Journal of Accounting Research, 50(2),...
  • DeFond, M., & Jiambalvo, J. (1994). Debt covenant violation and manipulation of accruals. Journal of Accounting and Economics, 17(1–2),...
  • Enomoto, M., Kimura, F., & Yamaguchi, T. (2015). Accrual-based and real earnings management: An international comparison for investor...
  • Ettredge, M., Scholz, S., Smith, K., & Sun, L. (2010). How do restatements begin? Evidence of earnings management preceding restated financial...
  • Fields, T., Lys, T., & Vincent, L. (2001). Empirical research on accounting choice. Journal of Accounting and Economics, 31(1–3), 255–307....
  • Francis, B., Hasan, I., & Li, L. (2016). Evidence for the existence of downward real-activity earnings management. Journal of Accounting,...
  • Ge, W. (2010). Essays on real earnings management. Montreal: McGill University.
  • Graham, J., Harvey, C., & Rajgopal, S. (2005). The economic implications of corporate financial reporting. Journal of Accounting and Economics,...
  • Gunny, K. (2010). The relation between earnings management using real activities manipulation and future performance: Evidence from meeting...
  • Healy, P. (1985). The effect of bonus schemes on accounting decisions. Journal of Accounting and Economics, 7(1–3), 85–107. http://dx.doi.org/10.1016/0165-4101(85)90029-1
  • Joosten, C. (2012). Real earnings management and accrual-based earnings management as substitutes. Tilburg: Thesis (Master thesis in Accountancy)...
  • Laksmana, I., & Yang, Y. (2014). Product market competition and earnings management: Evidence from discretionary accruals and real activity...
  • Lopo Martinez, A. (2013). Earnings management in Brazil: A survey of the literature. Brazilian Business Review (English Edition), 10(4), 1–29....
  • Martinez, A., & Cardoso, R. (2009). Gerenciamento de resultados contábeis no Brasil mediante decisões operacionais. REAd – Revista Eletrônica...
  • Medeiros Cupertino, C., Lopo Martinez, A., & da Costa, N. A., Jr. (2016). Consequences for future return with earnings management through...
  • Pincus, M., & Rajgopal, S. (2002). The interaction between accrual management and hedging: Evidence from oil and gas firms. The Accounting...
  • Roychowdhury, S. (2006). Earnings management through real activities manipulation. Journal of Accounting and Economics, 42(3), 335–370. http://dx.doi.org/10.1016/j.jacceco.2006.01.002
  • Sohn, B. C. (2016). The effect of accounting comparability on the accrual-based and real earnings management. Journal of Accounting and Public...
  • Subramanyam, K. (1996). The pricing of discretionary accruals. Journal of Accounting and Economics, 22(1–3), 249–281. http://dx.doi.org/10.1016/S0165-4101(96)00434-X
  • Xu, Z. (2008). Three essays on real earnings management. University of Alabama (Ph.D. Thesis).
  • Zang, A. (2012). Evidence on the tradeoff between real manipulation and accrual manipulation. The Accounting Review, 87(2), 675–703. http://dx.doi.org/10.2308/accr-10196
  • Zhu, T., Lu, M., Shan, Y., & Zhang, Y. (2015). Accrual-based and real activity earnings management at the back door: Evidence from Chinese...