A number of different models have been suggested for detecting earnings management but the linear regression-based model presented by Jones (1991) is the most frequently used. The underlying assumption with the Jones model is that earnings are managed through accounting accruals. Typically, the companies for which earnings management is studied are grouped based on their industries. It is thus ...

The major functions of company accounting identified by the IASB and the FASB are (1) reporting on ‘the custody and safekeeping’ of the company’s resources and (2) reporting on ‘their efficient and profitable use’. The joint IASB/FASB project for improving the conceptual framework for financial reporting is directed towards better performance of both functions within the conventional ‘accrual’ ...

In Germany, financial pressure and a lack of efficiency have caused the need for several reform processes in the local governments of German municipalities. These local governments are facing a growing contradiction between decreasing levels of financial support and increasing responsibilities. In order to address this tension, municipalities are starting to change their accounting systems by i...

A principal-agent relationship exists among creditors, shareholders and management, and information asymmetry among them leads to asymmetric loss functions, which induces conservative accounting. This paper investigates the determinants of accounting conservatism using accrual-based measures and data from 2001 to 2006 in China. We find that a higher degree of leverage, lower level of control of...

This research aims to test the influence of Human Resources Competency, Leadership Commitment, Information Technology Support, Internal Control over Financial Reporting on Quality Statements Ministries and Non-Ministries Government Indonesia, with intervening variables Implementation Accrual-based Accounting Standards (Empirical Studies Indonesia). The population in this study was Fifty-Three w...

this paper analyzes the relationship between capital structure and earning management. for analysing we used 119 non-financial companies that listed in tehran stock exchange from 2000 to 2008. the researchers will focus on comparing the jones model and the modified jones model, which are the two most frequently used model in empirical analysis nowadays. earnings management is a kind of manageme...

Objective: The main objective of this research is to explain the accrual anomaly using accruals factor (CMA) and accrual-based factor-mimicking portfolios as well as checking whether accrual anomaly is risk-based or mispricing. According to rational frictionless asset pricing model, the ability of accruals to predict returns should come from the loadings on this accrual factor loading that pred...