The effect of accrual earnings management and real earnings management on earnings persistence and cost of equity

Meini, Zumratul; Siregar, Sylvia Veronica

doi:10.14414/jebav.v17i2.309

Cited by 14 publications

(21 citation statements)

References 16 publications

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“…However, with accrual earnings management that could lead to decrease in the quality of financial reporting, investors might obtain misinformation related to corporate performance and earnings. The result of this study were consistent with research conducted by (Francis et al, 2004;Utami, 2005;Kim & Sohn, 2013;and Meini & Siregar, 2014) which stated that accrual earning management positively affected on the cost of equity. Research conducted by Kim & Sohn, 2013;Meini & Siregar (2014) in Indonesia also strengthened the results of previous research.…”

Section: Resultssupporting

confidence: 90%

“…Similar results are also shown by several studies that accrual earnings management will affect the cost of equity (Meini & Siregar, 2014). Investors consider accrual earning management actions as a risky action so that the information presented in the financial statements also carries risks (Septyanto, 2013).…”

Section: Introductionsupporting

confidence: 70%

“…Francis et al(2004) reveal the quality of accruals positively affect the cost of equity. This is reinforced by Kim & Sohn(2013);and Meini & Siregar (2014) who find that the accrual earning management has a positive effect on the cost of equity. Lambert et al(2007) also reveals when the quality of information is low (as shown by accrual earnings management), information owned by investor to assess future cash flows is less accurate that will increase uncertainty of investment returns, causing investors to want higher returns and increased equity costs.…”

Section: Introductionmentioning

confidence: 99%

“…However, (Meini & Siregar, 2014) reveal that real earnings management negatively affects the cost of equity. This can happen because investors have not been able to see the negative effects of real profit management.…”

Section: Introductionmentioning

confidence: 99%

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The Effects of Tax Avoidance, Accrual Earnings Management, Real Earnings Management, and Capital Intensity on the Cost of Equity

Firmansyah

Febriyanto

2018

jda

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This study aims to examince the effects of tax avoidance, accrual earning management, real earnings management and capital intensity on the cost of equity. The population of this study is a manufacturing company listed on the Indonesia Stock Exchange which amounted to 146 companies. The sampling technique used was purposive sampling and resulted in 420 units of analysis. This type of research is quantitative causality by performing hypothesis testing analysis is done by using multiple linear regression model. The findings of this research are tax avoidance will add to the risks that must be borne by investors thus increasing uncertainty over their investment. Investors consider that accrual profit management actions are opportunistic as risk-taking actions as well as real profit management actions. While on Capital Intensity, investors assume the information on the company's fixed assets is not useful in making investment decisions. The conclusions that can be taken are tax avoidance, accrual profit management, and earnings management real positive to the cost of equity. However, capital intensity has a negative effect.

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Section: Resultssupporting

confidence: 90%

Section: Introductionsupporting

confidence: 70%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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The Effects of Tax Avoidance, Accrual Earnings Management, Real Earnings Management, and Capital Intensity on the Cost of Equity

Firmansyah

Febriyanto

2018

jda

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“…Lobo & Zhou (2001) find that the quality of disclosure negatively affects accrual earning management. Febrininta & Siregar (2014); and Meini & Siregar (2014) find that earnings management and disclosure level have a negative relationship. Cassell et al(2015) find that accrual earnings management is lower in companies with transparent reserve accounts disclosure than companies that disclose non-transparent reserve accounts.…”

Section: Introductionmentioning

confidence: 99%

The Relationship of Reserve Account Disclosure Transparency and Accrual Earning Management with Audit Quality as Moderating

Nono

Khomsatun²

2018

jda

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The purpose of this study is to examine the effect of transparency of reserve account disclosure on accrual earning management, and also to examine the role of audit quality as a moderator for the effect of transparency of reserve account disclosure on accrual earning management. The population in the study are companies listed on the Indonesia Stock Exchange with a sample period of 2012-2015. The sample selection technique used purposive sampling. The samples were obtained 350 observations of manufacturing companies listed in Indonesia Stock Exchange period 2012 to 2015. This study uses panel regression statistical method with unbalance panel data. The measurements used for Transparency of reserve account disclosure are word count, sentence count, and disclosure index. The results support the hypothesis which show that transparency of reserve account disclosure have negative significant effect on the accrual earning management, audit quality have negative significant effect on accrual earning management, and audit quality has a role as moderator (strengthen) the Negative effect between transparency of reserve account disclosure to accrual earning management.Nevertheless, the result is inconsistent in each model. This study concludes that accrual earning management can be minimized by selecting competent auditors and increasing transparency of accounts receivable accounts.

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Does Real Activities Management Influence Earnings Quality and Stock Returns in Emerging Markets? Evidence from Korea

Jeong

Choi

2019

Emerging Markets Finance and Trade

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The effect of accrual earnings management and real earnings management on earnings persistence and cost of equity

Cited by 14 publications

References 16 publications

The Effects of Tax Avoidance, Accrual Earnings Management, Real Earnings Management, and Capital Intensity on the Cost of Equity

The Effects of Tax Avoidance, Accrual Earnings Management, Real Earnings Management, and Capital Intensity on the Cost of Equity

The Relationship of Reserve Account Disclosure Transparency and Accrual Earning Management with Audit Quality as Moderating

Does Real Activities Management Influence Earnings Quality and Stock Returns in Emerging Markets? Evidence from Korea

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