The Influence of Earnings Management and Board Characteristics on Company Efficiency

Abstract

Earnings management is a means by which managers manipulate earnings to conceal the true performance of a company. The characteristics of the board of directors can also influence firm performance. This study applies data envelopment analysis (DEA) and the Tobin regression model to investigate the influence of earnings management and board characteristics on company efficiency. The data sample includes 396 Taiwanese electronics and biotechnology companies from 2009 to 2017. The results indicate that earnings management has an insignificant influence on company efficiency with mixed results on the interactions between earnings management and board characteristics. When companies practiced earnings management, director experiences, a higher proportion of female directors, and a higher number of board meetings increased company efficiency. In contrast, a higher number of independent directors and a higher attendance rate of the directors at the board meeting decreased company efficiency. The results of this study suggest that board diversity, more female directors, and meetings could still improve firm performance despite companies’ engagement in earnings management.

Earnings management and corporate efficiency pre- and post-IFRS: evidence from Taiwanese listed electronics corporations

“…On the other hand, Huang et al . (2021) investigated the influence of earnings management on the company efficiency of 396 Taiwanese electronics and biotechnology companies from 2009 to 2017.…”

“…On the other hand, Huang et al (2021) investigated the influence of earnings management on the company efficiency of 396 Taiwanese electronics and biotechnology companies from 2009 to 2017. The findings reveal that when companies practice earnings management, director experiences, a higher proportion of female directors, and a higher number of board meetings increase company efficiency.…”

Prácticas de Gestión y/o Earnings Management en los resultados contables en México. Evidencia empírica 2010-2019

“…Lo anterior, en virtud que algunos estudios presentan relaciones de El gobierno corporativo es también una variable altamente utilizada en la literatura previa, que pretende identificar el grado en que las practicas societarias o corporativas sirven como una barrera para la manipulación de las cifras contables (Lawal et al, 2018;Nazir y Afza, 2018;Muda et al, 2018;Ayu y Zulfia, 2018;Alareeni, 2018;Habbash, 2019;Abdou et al, 2021;Kjaerland et al, 2020;Nyatichi et al, 2020;Zafar et al, 2020;Ngo, y Le, 2021;Afrizal, Gamayuni y Syaipudin, 2021;Ibama e Ibama, 2021). Por último, otro número importante de bibliografía apunta al análisis de la relación existente entre el indicador de rentabilidad, que permite conocer si una empresa está sobrevalorada o infravalorada en los mercados financieros, conocido como la Q de Tobin y la gestión de los resultados (Huang et al, 2021;Hernawati et al, 2021;Tulcanaza-Prieto y Lee, 2022).…”

Relevansi Financial Sustainability Measures Terhadap Manajemen Laba: Studi Empiris Pada Perusahaan Sektor Primer Dan Sekunder Yang Terdaftar Di Bei Periode 2017-2019

“…Hal ini membuat manajemen cenderung tidak melakukan manajemen laba. Sementara hasil ini tidak sejalan dengan penelitian Huang et al (2021) yang menemukan tidak ada hubungan yang signifikan antara efisiensi perusahaan dengan manajemen laba.…”