skip to main content
Language:
Search Limited to: Search Limited to: Resource type Show Results with: Show Results with: Search type Index

Earnings Management? Erroneous Inferences Based on Earnings Frequency Distributions

Journal of accounting research, 2009-12, Vol.47 (5), p.1249-1281 [Peer Reviewed Journal]

Copyright 2009 The Accounting Research Center at the University of Chicago Booth School of Business ;University of Chicago on behalf of the Accounting Research Center, 2009 ;2009 The Accounting Research Center at the University of Chicago Booth School of Business. ;ISSN: 0021-8456 ;EISSN: 1475-679X ;DOI: 10.1111/j.1475-679X.2009.00347.x ;CODEN: JACRBR

Full text available

Citations Cited by
  • Title:
    Earnings Management? Erroneous Inferences Based on Earnings Frequency Distributions
  • Author: DURTSCHI, CINDY ; EASTON, PETER
  • Subjects: Accounting ; Comparative analysis ; Creative accounting ; Distribution ; Dividend distributions ; Earnings ; Earnings management ; Earnings per share ; Economic deflation ; Frequency distribution ; Income distribution ; Legacies ; Market capitalization ; Market prices ; Net income ; Prices ; Quarterly estimates ; Sampling methods ; Studies
  • Is Part Of: Journal of accounting research, 2009-12, Vol.47 (5), p.1249-1281
  • Description: A vast literature following Hayn [1995] and Burgstahler and Dichev [1997] attributed the so-called "discontinuities" in earnings distributions around zero to earnings management. Despite recent evidence that these discontinuities are likely caused by other factors, researchers and teachers continue to point to the shapes of these distributions as evidence of earnings management. We provide three sets of further evidence that these discontinuities are likely caused by factors other than earnings management: (1) we provide, as an example, a detailed analysis of the severe effects of sample selection in a recent study; this study erroneously concludes that the shape of an earnings distribution is evidence of earnings management, (2) we provide a simple explanation for the shape of the earnings distribution that is most often cited as evidence of earnings management; the relation between earnings and prices differs with the magnitude and the sign of earnings, and (3) we provide further examples that support the main point of our paper; evidence beyond the mere shape of a distribution must be brought to bear before researchers can draw conclusions regarding the presence/absence of earnings management.
  • Publisher: Malden, USA: Blackwell Publishing Inc
  • Language: English
  • Identifier: ISSN: 0021-8456
    EISSN: 1475-679X
    DOI: 10.1111/j.1475-679X.2009.00347.x
    CODEN: JACRBR
  • Source: Alma/SFX Local Collection
    RePEc
Back to results list
INSPIRE LIBRARY - TON DUC THANG UNIVERSITY (84-028) 37 755 057 Feedback
19 Nguyen Huu Tho St. Dist.7, HCM thuvien@tdtu.edu.vn

Copyright © 2017 INSPIRE LIBRARY - TON DUC THANG UNIVERSITY

Searching Remote Databases, Please Wait