Managers' Ethical Evaluations of Earnings Management and Its Consequences

Contemporary Accounting Research

Volumn 29, Issue 3, 2012, Pages 910-927

  Johnson, Eric N ^a   Fleischman, Gary M ^a   Valentine, Sean ^b   Walker, Kenton B ^a  

^a UNIVERSITY OF WYOMING   (United States)

^b UNIVERSITY OF NORTH DAKOTA   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 84866341089     PISSN: 08239150     EISSN: 19113846     Source Type: Journal    
DOI: 10.1111/j.1911-3846.2011.01135.x     Document Type: Article

References (60)

1. Ajzen, I. 1991. The theory of planned behavior. Organizational Behavior and Human Decision Processes 50 (2): 179-211.
2. Bellizzi, J., and R. Hite 1989. Supervising unethical sales force behavior. Journal of Marketing 53 (2): 36-47.
3. Bernardi, R., and D. Arnold 2004. Testing the "inverted-U" phenomenon in moral development on recently promoted senior managers and partners. Contemporary Accounting Research 21 (2): 353-67.
4. Brown, M., and L. Treviño 2006. Ethical leadership: A review and future directions. The Leadership Quarterly 17 (6): 595-616.
5. Bruns, W., and K. Merchant 1990. The dangerous morality of managing earnings. Management Accounting 72 (2): 22-25.
6. Burns, J., and P. Kiecker 1995. Tax practitioner ethics: An empirical investigation of organizational consequences. Journal of the American Taxation Association 17 (2): 20-49.
7. Cohen, D., A. Dey, and T. Lys 2008. Real and accrual-based earnings management in the pre- and post-Sarbanes-Oxley periods. The Accounting Review 83 (3): 757-87.
8. Cohen, J., L. Holder-Webb, D. Sharp, and L. Pant 2007. The effects of perceived fairness on opportunistic behavior. Contemporary Accounting Research 24 (4): 1119-38.
9. Cohen, J., L. Pant, and D. Sharp 1996. Measuring the ethical awareness and ethical orientation of Canadian auditors. Behavioral Research in Accounting 8: 98-119.
10. Cooper, C. 2008. Extraordinary circumstances: The journey of a corporate whistleblower. Hoboken, NJ: Wiley.
11. Das, S., P. Shroff, and H. Zhang 2009. Quarterly earnings patterns and earnings management. Contemporary Accounting Research 26 (3): 797-831.
12. Davis-Friday, P., and T. Frecka 2002. What managers should know about earnings management: Its prevalence, legality, ethicality, and does it work? Review of Accounting and Finance 1 (1): 57-71.
13. Dechow, P., R. Sloan, and A. Sweeney 1995. Detecting earnings management. The Accounting Review 70 (2): 193-225.
14. Dechow, P., R. Sloan, and A. Sweeney 1996. Causes and consequences of earnings manipulation: An analysis of firms subject to enforcement actions by the SEC. Contemporary Accounting Research 13 (1): 1-36.
15. DeConinck, J., and W. Lewis 1997. The influence of deontological and teleological considerations and ethical climate on sales managers' intentions to reward or punish sales force behavior. Journal of Business Ethics 16 (5): 497-506.
16. Douglas, P., and B. Wier 2000. Integrating ethical dimensions into a model of budgetary slack creation. Journal of Business Ethics 28 (3): 267-277.
17. Elias, R. 2002. Determinants of earnings management ethics among accountants. Journal of Business Ethics 40 (1): 33-45.
18. Elias, R. 2004. The impact of corporate ethical values on perceptions of earnings management. Managerial Auditing Journal 19 (1): 84-98.
19. Fields, T., T. Lys, and L. Vincent 2001. Empirical research on accounting choice. Journal of Accounting and Economics 31 (1): 255-307.
20. Fischer, M., and K. Rosenzweig 1995. Attitudes of students and accounting practitioners concerning the ethical acceptability of earnings management. Journal of Business Ethics 14 (6): 433-44.
21. Fleischman, G., S. Valentine, and D. Finn 2007. Ethical reasoning and equitable relief. Behavioral Research in Accounting 19: 107-32.
22. Flory, S., T. Phillips, Jr, R. Reidenbach, and D. Robin 1992. A multidimensional analysis of selected ethical issues in accounting. The Accounting Review 67 (2): 284-302.
23. Gino, F., and M. Bazerman 2009. When misconduct goes unnoticed: The acceptability of gradual erosion in others' unethical behavior. Journal of Experimental Social Psychology 45 (4): 708-19.
24. Grasso, L., P. Tilley, and R. White 2009. The ethics of earnings management: Perceptions after Sarbanes-Oxley. Management Accounting Quarterly 11 (1): 45-69.
25. Greenfield, A., C. Norman, and B. Wier 2008. The effect of ethical orientation and professional commitment on earnings management behavior. Journal of Business Ethics 83 (3): 419-34.
26. Gunny, K. 2010. The relation between earnings management using real activities manipulation and future performance: Evidence from meeting earnings benchmarks. Contemporary Accounting Research 27 (3): 855-88.
27. Hair, J., E. Anderson, R. Tatham, and W. Black 1998. Multivariate data analysis. Upper Saddle River, NJ: Prentice Hall.
28. Healy, P. 1985. The effect of bonus schemes on accounting decisions. Journal of Accounting and Economics 7 (1-3): 85-107.
29. Healy, P., and J. Wahlen 1999. A review of the earnings management literature and its implications for standard setting. Accounting Horizons 13 (4): 365-84.
30. Hunt, S., and A. Vasquez-Parraga 1993. Organizational consequences, marketing ethics, and sales force supervision. Journal of Marketing Research 30 (1): 78-90.
31. Hunt, S., and S. Vitell 1986. A general theory of marketing ethics. Journal of Macromarketing 6 (1): 5-16.
32. Hunt, S., and S. Vitell 1993. The general theory of marketing ethics: A retrospective and revision. In Ethics in marketing, ed. N. Smith and J. Quelch, 775-84. Homewood, IL: Irwin.
33. Hunt, S., and S. Vitell 2006. The general theory of marketing ethics: A revision and three questions. Journal of Macromarketing 26 (2): 143-53.
34. Jensen, M. 2003. Paying people to lie: The truth about the budgeting process. European Financial Management 9 (3): 379-406.
35. Jones, J., D. Massey, and L. Thorne 2003. Auditors' ethical reasoning: Insights from past research and implications for the future. Journal of Accounting Literature 22 (3): 45-103.
36. Jones, T. 1991. Ethical decision making by individuals in organizations: An issue contingent model. Academy of Management Review 16 (2): 366-95.
37. Kaplan, S. 2001. Further evidence on the ethics of managing earnings: An examination of the ethically related judgments of shareholders and non-shareholders. Journal of Accounting and Public Policy 20 (1): 27-44.
38. Kaplan, S., J. McElroy, S. Ravenscroft, and C. Shrader 2007. Moral judgment and causal attributions: Consequences of engaging in earnings management. Journal of Business Ethics 74 (2): 149-64.
39. Kaplan, S., and S. Ravenscroft 2004. The reputation effects of earnings management in the internal labor market. Business Ethics Quarterly 14 (3): 453-78.
40. Lev, B. 2003. Corporate earnings: Facts and fiction. Journal of Economic Perspectives 17 (2): 27-50.
41. Marquardt, C., and C. Wiedman 2004. How are earnings managed? An examination of specific accruals. Contemporary Accounting Research 21 (2): 461-91.
42. McPhail, K. 2001. The other objective of ethics education: Re-humanising the accounting profession: A study of ethics education in law, engineering, medicine and accountancy. Journal of Business Ethics 34 (3-4): 279-98.
43. Merchant, K., and J. Rockness 1994. The ethics of managing earnings: An empirical investigation. Journal of Accounting and Public Policy 13 (1): 79-94.
44. Ng, J., G. White, A. Lee, and A. Moneta 2009. Design and validation of a novel new instrument for measuring the effect of moral intensity on accountants' propensity to manage earnings. Journal of Business Ethics 84 (3): 367-87.
45. Parfet, W. 2000. Accounting subjectivity and earnings management: A preparer perspective. Accounting Horizons 14 (4): 481-88.
46. Ponemon, L. 1992. Ethical reasoning and selection-socialization in accounting. Accounting, Organizations and Society 17 (3-4): 239-58.
47. Prentice, R. 2007. Ethical decision making: More needed than good intentions. Financial Analysts Journal 63 (6): 17-30.
48. Reidenbach, R., and D. Robin 1990. Toward the development of a multidimensional scale for improving evaluations of business ethics. Journal of Business Ethics 9 (8): 639-53.
49. Rest, J. 1986. Moral development: Advances in research and theory. New York: Praeger.
50. Ronen, J., and V. Yaari 2008. Earnings management: Emerging insights in theory, practice, and research. New York: Springer.
51. Roychowdhury, S. 2006. Earnings management through real activities manipulation. Journal of Accounting and Economics 42 (3): 335-70.
52. Schipper, K. 1989. Commentary on earnings management. Accounting Horizons 3 (4): 91-102.
53. Scott, W. 2003. Financial accounting theory, 3rd ed. Upper Saddle River, NJ: Prentice Hall.
54. Strahan, R., and K. Gerbasi 1972. Short, homogeneous versions of the Marlowe-Crowne social desirability scale. Journal of Clinical Psychology 28 (2): 191-93.
55. Tenbrunsel, A., and D. Messick 2004. Ethical fading: The role of self-deception in unethical behavior. Social Justice Research 17 (2): 223-36.
56. Thorne, L., and J. Hartwick 2001. The directional effects of discussion on auditors' moral reasoning. Contemporary Accounting Research 18 (2): 337-61.
57. Treviño, L. 1986. Ethical decision making in organizations: A person-situation interactionist model. Academy of Management Review 11 (3): 601-17.
58. Treviño, L., G. Weaver, and S. Reynolds 2006. Behavioral ethics in organizations: A review. Journal of Management 32 (6): 951-90.
59. Valentine, S., G. Fleischman, R. Sprague, and L. Godkin 2010. Exploring the ethicality of firing employees who blog. Human Resource Management 49 (1): 87-108.
60. Wong-On-Wing, B., and L. Gladie 2007. Culture, implicit theories, and attribution of morality. Behavioral Research in Accounting 19: 231-46.