Earnings Management Prior to Stock Option Grants

Balsam, Steven; Chen, Lucy Huajing; Sankaraguruswamy, Srinivasan

doi:10.2139/ssrn.378440

Cited by 44 publications

(56 citation statements)

References 27 publications

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“…Institutional investors plays an active role in controlling managerial discretion and improving the efficiency of information in capital markets, as the investors are sophisticated with advantages in acquiring and processing information (Balsam et al 2003;Koh 2003;Ferreira and Matos 2008;Ruiz et al 2009;Ferreira et al 2010), so limiting opportunism and promoting the reduction of agency costs (Shleifer and Vishny 1997;Rajgopal et al 2002;Chung et al 2002). In this way, Koh (2003) and Hsu and Koh (2005) propose that the role of institutional investors in firms can be approximated by considering the level of participation of the institutional shareholders in them, i.e., that institutional ownership may act as a governance mechanism that affects the EM based on the level of their participation.…”

Section: Institutional Ownershipmentioning

confidence: 99%

“…We also include the indebtedness level variable (Debt), calculated as the ratio of total debt and total assets. Thus, a high indebtedness is associated with the risk of excessive leverage (Press and Weintrop 1990), which motivates the EM to conceal inconvenient information and display a greater capacity to generate resources (Dechow et al 1995;Krishnan et al 1996;Balsam et al 2003).…”

Section: Models and Variables Definitionmentioning

confidence: 99%

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Does Corporate Governance Influence Earnings Management in Latin American Markets?

2013

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Although US and European research has documented improvement in earnings quality associated with corporate governance characteristics, the situation in Latin America is questionable, given the business environment in which firms operate, which is characterized by controlling family ownership and weak legal protection. The purpose of this study is to examine the relation between the internal mechanisms of Corporate Governance and Earnings Management measured by discretionary accrual. We use a sample of listed Latin American non-financial companies from the period 2006-2009. Our results show how in the Latin American context the role of external directors is limited and that Boards which meet more frequently take a more active position in the monitoring of insiders, so showing a lower use of manipulative practices. In addition, we find a non-linear relation between insider ownership and discretionary accruals, also pointing to the fact that ownership concentration may be a manipulative practices constrictor mechanism only when the ownership of main shareholders is moderate. The findings have important policy implications since this is, to the best of our knowledge, the first study to analyze the relation between the effectiveness of the government and the earnings management behavior. As policy implications, we document how when a country implements controls aimed at reducing corruption, strengthening the rule of law or improving the effectiveness of government, this leads to a reduction in firm earnings management.

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Section: Institutional Ownershipmentioning

confidence: 99%

Section: Models and Variables Definitionmentioning

confidence: 99%

Does Corporate Governance Influence Earnings Management in Latin American Markets?

2013

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“…Sebagaimana Balsam et al (2003), proporsi opsi saham eksekutif adalah jumlah lembar opsi saham yang dihibahkan pada eksekutif selama jendela kejadian (event window) dideflasi dengan kepemilikan manajerial. Harapan penelitian ini adalah koefisien variabel hibah negatif untuk perioda sebelum penawaran opsi saham.…”

Section: Pengukuran Proporsi Opsi Saham Eksekutifunclassified

“…Dengan demikian penelitian ini berhasil menolak H01. Penelitian ini konsisten dengan studi Chauvin & Shenoy (2000), Baker et al, (2002), dan Balsam et al, (2003). Hasil penelitian menunjukkan bahwa nilai F kalkulasian sebesar 10,839 dengan nilai probabilitas 0,000 secara statistis signifikan pada tingkat 1%.…”

Section: Hipotesisunclassified

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Executive Stock Option Plans: Uji Pengelolaan Laba Selama Vesting Period

Asyik

2017

EKUITAS

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This study examine earnings management behavior related to compensation in the form of stock options during implementation of the grant program (vesting period) PENDAHULUANTeori entitas (entity theory) memandang perusahaan sebagai suatu entitas yang terpisah dari pemilik dan krediturnya. Berdasarkan pandangan teori tersebut, manajemen terpisah dari pemilik perusahaan. Manajemen memperoleh kepercayaan dari pemilik untuk mengelola perusahaan, dan atas jasa yang diberikan, para manajer memperoleh kompensasi (Jensen dan Meckling, 1976). Dua pihak yang melakukan kontrak dalam agency theory (prinsipal-agen) biasanya berada dalam situasi ketidakseimbangan informasi (asymmetrical information), artinya bahwa agen mempunyai lebih banyak

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Motives of Earnings Management

Diri

2017

Introduction to Earnings Management

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Earnings Management Prior to Stock Option Grants

Cited by 44 publications

References 27 publications

Does Corporate Governance Influence Earnings Management in Latin American Markets?

Does Corporate Governance Influence Earnings Management in Latin American Markets?

Executive Stock Option Plans: Uji Pengelolaan Laba Selama Vesting Period

Motives of Earnings Management

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