The effect of earnings management on the asymmetric timeliness of earnings

Journal of Business Finance and Accounting

Volumn 32, Issue 3-4, 2005, Pages 691-726

  García Lara, Juan Manuel ^a,c   Osma, Beatriz García ^a   Mora, Araceli ^b  

^a LANCASTER UNIVERSITY   (United Kingdom)

^b UNIVERSITY OF VALENCIA   (Spain)

^c LANCASTER UNIVERSITY   (United Kingdom)

Author keywords

Comparability; Conservatism; Earnings management; Europe

Indexed keywords

EID: 27844549868     PISSN: 0306686X     EISSN: 14685957     Source Type: Journal    
DOI: 10.1111/j.0306-686X.2005.00610.x     Document Type: Review

References (48)

1. Ball, R., S.P. Kothari and A. Robin (2000), 'The Effect of International Institutional Factors on Properties of Accounting Earnings', Journal of Accounting and Economics, Vol. 29 (February), pp. 1-51.
2. Basu, S. (1997), 'The Conservatism Principle and the Asymmetric Timeliness of Earnings', Journal of Accounting and Economics, Vol. 24 (December), pp. 3-37.
3. _ (1999), 'Discussion of International Differences in the Timeliness, Conservatism and Classification of Earnings', Journal of Accounting Research, Vol. 37 (Supplement), pp. 89-99.
4. Beaver, W.H., M.F. McNichols and K.K. Nelson (2003), 'An Alternative Interpretation of the Discontinuity in Earnings Distributions', Working Paper (Stanford University).
5. Beneish, M.D. (1998), 'Discussion of 'Are Accruals During Initial Public Offering Opportunistic?", Review of Accounting Studies, Vol. 3, No. 1, pp. 209-21.
6. DeAngelo, H. and L. DeAngelo (1991), 'Union Negotiations and Corporate Policy: A Study of Labor Concessions in the Domestic Steel Industry During the 1980s', Journal of Financial Economics, Vol. 30 (November), pp. 3-43.
7. Dechow, P.M. (1994), 'Accounting Earnings and Cash Flows as Measures of Firm Performance: The Role of Accounting Accruals', Journal of Accounting and Economics, Vol. 18 (July), pp. 3-42.
8. _ S.A. Richardson and I. Tuna (2003), 'Why are Earnings Kinky? An Examination of the Earnings Management Explanation', Review of Accounting Studies, Vol. 8 (June/September), pp. 355-84.
9. _ and D.J. Skinner (2000), 'Earnings Management: Reconciling the Views of Accounting Academics, Practitioners and Regulators', Accounting Horizons, Vol. 14 (June), pp. 235-50.
10. _ R.G. Sloan and A.P. Sweeney (1995), 'Detecting Earnings Management', The Accounting Review, Vol. 70 (April), pp. 193-225.
11. Easton, P.D., T.S Harris and J.A. Ohlson (1992), 'Aggregate Accounting Earnings Can Explain Most of Security Returns', Journal of Accounting and Economics, Vol. 15 (June/September), pp. 119-42.
12. Ehrhardt, O. and M. Schmidt (2003), 'Managerial Discretion in Internal Finance:A Test of Pecking Order and Accruals Management Under German Corporate and Accounting Regulation', Working Paper (Humboldt-University Berlin).
13. Fama, E. arid K. French (2002), 'Testing Tradeoff and Pecking Order Predictions About Dividends and Debt', Review of Financial Studies, Vol. 15 (Spring), pp. 1-33.
14. _ and J. MacBeth (1973), 'Risk, Return, and Equilibrium: Empirical Tests', Journal of Political Economy, Vol. 81 (May/June), pp. 607-36.
15. Feltham, G. and J.A. Ohlson (1995), 'Valuation and Clean Surplus Accounting for Operating and Financial Activities', Contemporary Accounting Research, Vol. 11 (Spring), pp. 689-732.
16. Financial Accounting Standards Board (1980), Statement of Financial Accounting Concepts No. 2, Qualitative Characteristics of Accounting Information (Norwalk, Connecticut).
17. Friedlan, J.M. (1994), 'Accounting Choices of Issuers of Initial Public Offerings', Contemporary Accounting Research, Vol. 11 (Summer), pp. 1-34.
18. García Lara, J.M. and A. Mora (2004), 'Balance Sheet versus Earnings Conservatism in Europe', The European Accounting Review, Vol. 13, pp. 261-92.
19. Gill de Albornoz Noguer, B. and M. Illueca Muñoz (2004), 'Comparing Abnormal Accruals Models: A Non-parametric Approach', Applied Economics, Vol. 36, No. 13, pp. 1455-60.
20. Giner, B. and W. Rees (2001), 'On the Asymmetric Recognition of Good and Bad News in France, Germany and the United Kingdom', Journal of Business, Finance & Accounting, Vol. 28 (November/December), pp. 1285-331.
21. Givoly, D. and C. Hayn (2000), 'The Changing Time-series Properties of Earnings, Cash Flows and Accruals: Has Financial Reporting Become More Conservative?', Journal of Accounting and Economics, Vol. 29 (June), pp. 287-320.
22. Gore, P., P.F. Pope and A.K. Singh (2002), 'Earnings Management and the Distribution of Earnings Relative to Targets: U.K. Evidence", Working Paper (Lancaster University).
23. Guay, W.R., S.P. Kothari and R.L. Watts (1996), 'A Market Based Evaluation of Discretionary Accruals Models', Journal of Accounting Research, Vol. 34 (Supplement), pp. 83-105.
24. Harris, T.S., M. Lang and P. Möller (1994), 'The Value Relevance of German Accounting Measures: An Empirical Analysis', Journal of Accounting Research, Vol. 32 (Autumn), pp. 187-209.
25. Healy, P.M. and J.M. Wahlen (1999), 'A Review of the Earnings Management Literature and its Implications for Standard Setters', Accounting Horizons, Vol. 13 (December), pp. 365-83.
26. International Accounting Standards Committee (1989), Framework for the Preparation and Presentation of Financial Statements (London).
27. Jensen, M. and W. Meckling (1976), 'Theory of the Firm: Managerial Behaviour, Agency Costs and Ownership Structure', Journal of Financial Economics, Vol. 3 (October), pp. 305-60.
28. Jones, J.J. (1991), 'Earnings Management During Import Relief Investigations', Journal of Accounting Research, Vol. 29 (Autumn), pp. 193-228.
29. Joos, P. (1997), 'The Stock Market Valuation of Earnings and Book Value Across International Accounting Systems,' Doctoral Thesis (UMI).
30. _ and M. Lang (1994), 'The Effects of Accounting Diversity: Evidence from the European Union', Journal of Accounting Research, Vol. 32 (Supplement), pp. 141-168.
31. Kasanen, E., J. Kinnunen and J. Niskanen (1996), 'Dividend-based Earnings Management: Empirical Evidence from Finland', Journal of Accounting and Economics, Vol. 22 (August-December), pp. 283-312.
32. La Porta, R., F. López-de-Silanes, A. Shleifer and R.W. Vishriy (2000), 'Agency Problems and Dividend Policies Around the World', The Journal of Finance, Vol. 55 (February), pp. 1-33.
33. Lamb, M., C.W. Nobes and A. Roberts (1998), 'International Variations in the Connections Between Tax and Financial Reporting', Accounting and Business Research, Vol. 28 (Summer), pp. 173-88.
34. Leuz, G., D. Nanda and P.D. Wysocki (2003), 'Earnings Management and Investor Protection: An International Comparison', Journal of Financial Economics, Vol. 69 (September), pp. 505-27.
35. Liberty, S.E. and J.L. Zimmerman (1986), 'Labor Union Contract Negotiations and Accounting Choices', The Accounting Review, Vol. 61 (October), pp. 692-712.
36. Myers, S.C. (1984), 'The Capital Structure Puzzle', The Journal of Finance, Vol. 39 (July), pp. 575-92.
37. _ and N. Majluf (1984), 'Corporate Financing and Investment Decisions When Firms Have Information Investors Do Not Have', Journal of Financial Economics, Vol. 13 (June), pp. 187-221.
38. Peasnell, K.V., P.F. Pope and S. Young (2000a), 'Detecting Earnings Management Using Cross-sectional Abnormal Accruals Models', Accounting and Business Research, Vol. 30 (Autumn), pp. 313-26.
39. _ (2000b), 'Accrual Management to Meet Earnings Targets: UK Evidence Pre- and Post- Cadbury', British Accounting Review, Vol. 32 (December), pp. 415-45.
40. Pope, P.F. and M. Walker (1999), 'International Differences in the Timeliness, Conservatism and Classification of Earnings', Journal of Accounting Research, Vol. 37 (Supplement), pp. 53-87.
41. _ (2003), 'Ex-ante and Ex-post Accounting Conservatism, Asset Recognition and Asymmetric Earnings Timeliness', Working Paper (Lancaster University and University of Manchester).
42. Rangan, S. (1998), 'Earnings Management and the Performance of Seasoned Equity Offerings', Journal of Financial Economics, Vol. 50 (October), pp. 101-22.
43. Raonic, I., S.J. Mcleay and I. Asimakopoulos (2004), 'The Timeliness of Income Recognition by European Companies: An Analysis of Institutional and Market Complexity', Journal of Business Finance & Accounting, Vol. 31 (January), pp. 115-48.
44. Richard, J. (2001), 'France. Group Accounts', in D. Ordelheide (ed.), Transnational Accounting (2nd ed., Palgrave Publishers).
45. Seckler, G. (1998), 'Germany', in A. Alexander arid S. Archer (eds.), European Accounting Guide (3rd ed., Harcourt Brace).
46. Teoh, S.H., I. Welch and T.J. Wong (1998), 'Earnings Management and the Underperformance of Seasoned Equity Offerings', Journal of Financial Economics, Vol. 50 (October), pp. 63-99.
47. White, H. (1980), 'A Heteroskedasticity-consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity', Econometrica, Vol. 48 (May), pp. 817-38.
48. Young, S. (1999), 'Systematic Measurement Error in the Estimation of Discretionary Accruals: An Evaluation of Alternative Modelling Procedures', Journal of Business Finance & Accounting, Vol. 26 (September/October), pp. 833-62.