Accrual-based and real earnings management to achieve earnings benchmarks: evidence from Finnish listed companies during 2005-2012

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dc.contributor Aalto-yliopisto fi
dc.contributor Aalto University en Jansson, Henri 2015-04-02T12:47:26Z 2015-04-02T12:47:26Z 2015
dc.description.abstract This study examines earnings management to achieve earnings benchmarks. Earnings management is examined in terms of both accrual-based earnings management and real earnings management, the latter of which, is further decomposed into separate investigation of sales manipulation and overproduction. This study particularly focuses on earnings management associated with the following three earnings benchmarks: meeting analysts' earnings expectations, reporting positive profits and improving previous year's financial performance. This study is quantitative in nature. The sample of the study consists of companies listed in the Helsinki Stock Exchange during the research period of 8 years between 2005 and 2012. The sample is first categorized into two sub-samples based on distributions of sample companies' reported earnings around earnings benchmarks. Further, OLS regression based estimation models are applied to assess the levels of earnings management within the sub-samples. The results of this study indicate that management's desire to achieve earnings benchmarks acts as an incentive for earnings management in the Finnish context. In particular, the study results suggest that Finnish companies engage in accrual-based earnings management to reach analysts' earnings expectations, and exercise overproduction to improve previous year's financial performance. Regarding the benchmark of reporting positive profits, however, this study does not find proof of any type of earnings management to reach this benchmark. en
dc.format.extent 74
dc.language.iso en en
dc.title Accrual-based and real earnings management to achieve earnings benchmarks: evidence from Finnish listed companies during 2005-2012 en
dc.type G2 Pro gradu, diplomityö fi Kauppakorkeakoulu fi School of Business en
dc.contributor.department Laskentatoimen laitos fi
dc.contributor.department Department of Accounting en
dc.subject.keyword earnings management
dc.subject.keyword earnings benchmark
dc.subject.keyword accrual-based earnings management
dc.subject.keyword real earnings management
dc.subject.keyword sales manipulation
dc.subject.keyword overproduction
dc.identifier.urn URN:NBN:fi:aalto-201504032148
dc.type.dcmitype text en
dc.programme.major Accounting en
dc.programme.major Laskentatoimi fi
dc.type.ontasot Master's thesis en
dc.type.ontasot Pro gradu tutkielma fi
dc.subject.helecon laskentatoimi
dc.subject.helecon accounting
dc.subject.helecon tulos
dc.subject.helecon return
dc.subject.helecon suunnittelu
dc.subject.helecon planning
dc.subject.helecon yritykset
dc.subject.helecon companies
dc.ethesisid 13903 2015-03-12
dc.location P1 I

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