Performance matched discretionary accrual measures

Kothari, S.P.; Leone, Andrew J.; Wasley, Charles E.

doi:10.1016/j.jacceco.2004.11.002

Cited by 5,256 publications

(3,235 citation statements)

References 41 publications

Supporting

Mentioning

2,976

Contrasting

Unclassified

187

Order By: Relevance

“…FRQ is measured using the Kothari et al (2005) model for earnings quality, variation of the Basu (1997) model proposed by Khan and Watts (2009) for accounting conservatism and the Ball-Shivakumar (2006) model for accruals quality.…”

Section: Results Of Dependency Modelsmentioning

confidence: 99%

“…CORRUPTION is a numerical variable that represents the level of corruption in each country. FRQKOTHARI represents an earnings management measure with the Kothari et al (2005) model; C_SCORE and B_SCORE are measures for accounting conservatism proposed by Khan and Watts (2009); BALLSHIVAKUMAR is measured for accruals quality with the Ball and Shivakumar (2006) model; SIZE is the logarithm of total assets; DEBT is the ratio of debt to equity; RISK represents the risk faced measured by the beta; WORKING_CAPITAL represents liquidity, measured as the difference between current assets and current liabilities; INDUSTRY represents the different activity sectors; R&DINTENSITY represents the ratio of R&D expenditure to total sales. IFRS is a dummy variable that takes the value 1 if the country of the company has adopted the IFRS and 0 otherwise.…”

Section: Results Of Model Dependence With Moderating Factorsmentioning

confidence: 99%

“…In this study, I use the Kothari model (Kothari et al, 2005) to separate the non-discretionary component of accruals from the discretionary one. This model is explained in Appendix 1.…”

Section: Earnings Management (Em) Through Accrualsmentioning

confidence: 99%

See 2 more Smart Citations

Consequences of financial reporting quality on corporate performance: Evidence at the international level

Martínez‐Ferrero

2014

Estudios de Economía

View full text Add to dashboard Cite

This paper examines the consequences of Financial Reporting Quality (FRQ) on Corporate Performance, using three proxies of FRQ: (i) earnings quality;(ii) conservatism; and (iii) JEL Classification: M41 Resumen Este trabajo examina las consecuencias de la Calidad de Información Financiera (FRQ) en el desempeño empresarial, con tres alternativas de FRQ: (i) earnings quality, (ii) conservadurismo, y (iii) accruals quality. Nuestro objetivo es analizar el efecto de la FRQ en el rendimiento financiero (FP) medido por el valor de mercado. A tal efecto, las hipótesis propuestas son testadas para

show abstract

Section: Results Of Dependency Modelsmentioning

confidence: 99%

Section: Results Of Model Dependence With Moderating Factorsmentioning

confidence: 99%

See 1 more Smart Citation

Consequences of financial reporting quality on corporate performance: Evidence at the international level

Martínez‐Ferrero

2014

Estudios de Economía

View full text Add to dashboard Cite

show abstract

“…In order to control for potential limitations in the Jones Modified Model, we entertain the empirical model (for all subsamples) using absolute discretionary accruals estimated by different models, namely the versions based on Larcker and Richardson (2004) and Kothari, Leone and Wasley (2005). Larcker and Richardson (2004) added the current operating cash flows (CFO) and the book-tomarket ratio (BTM) as proxies for expected growth in the firm's operations, since they expect growing firms to have larger accruals.…”

Section: Sensibility Testsmentioning

confidence: 99%

“…The model is estimated according to Equations (6) and (7), and it is expected to control for these additional factors. Despite these authors introduce the ratio between the book value and the market value of the firm, the present study applies the opposite ratio between the market value and the book value (MTB), simply to ease interpretation: (6) (7) Kothari et al (2005) include the current ROA as a performance measure on the calculation of accruals, as in Equations (8) and (9), as a mean for firms' performance:…”

Section: Sensibility Testsmentioning

confidence: 99%

International Financial Reporting Standards and Earnings Management in Latin America

Rathke

Santana

Lourenço³

et al. 2016

Rev. adm. contemp.

View full text Add to dashboard Cite

ResumoEssa pesquisa analisa o nível de gerenciamento de resultados na América Latina após a adoção das International Financial Reporting Standards (IFRS), em comparação aos países anglo-saxões e europeu-continentais. Ela também analisa o efeito da listagem de ações nos Estados Unidos sobre a comparação do nível de gerenciamento de resultados das empresas latino-americanas com empresas estrangeiras. A literatura sobre gerenciamento de resultados considerando países menos desenvolvidos ainda está em construção, e poucos estudos focam esse tema, especialmente na América Latina, apesar de sua relevância para a economia global. A presente pesquisa preenche essa lacuna por meio do exame do nível de gerenciamento de resultados nos principais países latino-americanos que adotam as IFRS (Brasil e Chile), em comparação com os principais países anglo-saxões com tradição em IFRS (Reino Unido e Austrália), e com as principais economias da Europa Continental (França e Alemanha). Os resultados demonstram que os latino-americanos apresentam um maior nível de gerenciamento de resultados que os anglo-saxões e europeu-continentais, e esse comportamento oportunista se mantém significativo quando apenas global players com listagem de ações nos Estados Unidos são analisados. Logo, mesmo com um conjunto único de padrões contábeis de elevada qualidade (IFRS) e fortes incentivos à divulgação, as características específicas dos países produzem forte influência na forma como as IFRS são implementadas em cada país. Palavras-chave: IFRS; gerenciamento de resultados; América Latina. AbstractThis study analyzes the level of earnings management in Latin America after the adoption of the International Financial Reporting Standards (IFRS) and analyzes the role of cross-listing in the United States. The literature on earnings management in less developed countries is still under construction, and few studies focus on this issue, especially with respect to Latin America, despite its relevant role in the global economy. This paper fills this gap in the literature as it analyzes the level of IFRS earnings management regarding the first and main Latin American countries applying IFRS (Brazil and Chile), when compared to the main Anglo-Saxon countries with IFRS tradition (United Kingdom and Australia), and with the main Continental European economies (France and Germany). The results show that Latin American firms present a higher level of earnings management than Continental European and Anglo-Saxon firms, and this opportunistic behavior remains significant when only global players with cross-listing in the United States are analyzed. Thus, even with a unique set of high quality accounting standards (IFRS) and strong reporting incentives, countries' specific characteristics still play an important role in the way IFRS is implemented in each country.

show abstract

International Business

Noi¹

2012

What's Your MBA IQ™?

View full text Add to dashboard Cite

Performance matched discretionary accrual measures

Cited by 5,256 publications

References 41 publications

Consequences of financial reporting quality on corporate performance: Evidence at the international level

Consequences of financial reporting quality on corporate performance: Evidence at the international level

International Financial Reporting Standards and Earnings Management in Latin America

International Business

Contact Info

Product

Resources

About