The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises

This paper analyzes earning management in firms under financial crises and its effects on earning quality compared with other firms during 2005-2010, using the data of 32 firms under financial crises and 82 other firms to test research hypothesis. The Iranian commercial Act of 141 is used to identif...

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Formato:	article
Lenguaje:	FA
Publicado:	Shahid Bahonar University of Kerman 2013
Materias:	financial crises earning management discretionary accruals conditional conservatism Accounting. Bookkeeping HF5601-5689
Acceso en línea:	https://doaj.org/article/7fccdda1ecca42e9ac6a98d57c748649
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spelling	oai:doaj.org-article:7fccdda1ecca42e9ac6a98d57c7486492021-11-04T19:45:16ZThe Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises2008-89142476-292X10.22103/jak.2013.558https://doaj.org/article/7fccdda1ecca42e9ac6a98d57c7486492013-08-01T00:00:00Zhttps://jak.uk.ac.ir/article_558_bab04aaf09ce2fe3bb9ef3c931277319.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XThis paper analyzes earning management in firms under financial crises and its effects on earning quality compared with other firms during 2005-2010, using the data of 32 firms under financial crises and 82 other firms to test research hypothesis. The Iranian commercial Act of 141 is used to identify firms under financial crises. The findings show that the firms under financial crises through accrual manipulation and by real activities manipulating have managed earnings more than other firms, in four years before the begining of financial crises. Accounting and real activities manipulations are analyzed, using Kasznik, (1999), discretionary accruals model, and Roychowdhury, (2006), abnormal cash flow model, respectively. In the next step the impact of managed earning on the earning quality has been assessed by conditional conservatism criterion. Ball and Shivakumar (2005) model is used to measure conditional conservatism.Conditional conservatism tests show that, both groups of firms engage in aggressive accounting methods, and that in spite of the existence of more earning management in the firms under financial crises in comparison with other firms, there is not any difference between earning quality of firms with financial crises and other firms.Shahid Bahonar University of Kermanarticlefinancial crisesearning managementdiscretionary accrualsconditional conservatismAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 4, Iss 13, Pp 75-103 (2013)
institution	DOAJ
collection	DOAJ
language	FA
topic	financial crises earning management discretionary accruals conditional conservatism Accounting. Bookkeeping HF5601-5689
spellingShingle	financial crises earning management discretionary accruals conditional conservatism Accounting. Bookkeeping HF5601-5689 The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
description	This paper analyzes earning management in firms under financial crises and its effects on earning quality compared with other firms during 2005-2010, using the data of 32 firms under financial crises and 82 other firms to test research hypothesis. The Iranian commercial Act of 141 is used to identify firms under financial crises. The findings show that the firms under financial crises through accrual manipulation and by real activities manipulating have managed earnings more than other firms, in four years before the begining of financial crises. Accounting and real activities manipulations are analyzed, using Kasznik, (1999), discretionary accruals model, and Roychowdhury, (2006), abnormal cash flow model, respectively. In the next step the impact of managed earning on the earning quality has been assessed by conditional conservatism criterion. Ball and Shivakumar (2005) model is used to measure conditional conservatism.Conditional conservatism tests show that, both groups of firms engage in aggressive accounting methods, and that in spite of the existence of more earning management in the firms under financial crises in comparison with other firms, there is not any difference between earning quality of firms with financial crises and other firms.
format	article
title	The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
title_short	The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
title_full	The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
title_fullStr	The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
title_full_unstemmed	The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises
title_sort	investigation of earning management effects on earning quality in firms under financial crises
publisher	Shahid Bahonar University of Kerman
publishDate	2013
url	https://doaj.org/article/7fccdda1ecca42e9ac6a98d57c748649
_version_	1718444660955807744

The Investigation of Earning Management Effects on Earning Quality in Firms Under Financial Crises

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