Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective
The systematic study of earnings management has now developed into a dynamic body of empirical literature. Despite a dynamic body of earnings management research that are well founded in economic theory, there have not been any attempts to take an integrated perspective (Beneish, 2001).This study in...
| Main Authors: | , |
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| Format: | Journal Article |
| Published: |
World Business Institute
2008
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| Online Access: | http://hdl.handle.net/20.500.11937/21981 |
| _version_ | 1848750743121559552 |
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| author | Sun, L. Rath, Subhrendu |
| author_facet | Sun, L. Rath, Subhrendu |
| author_sort | Sun, L. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | The systematic study of earnings management has now developed into a dynamic body of empirical literature. Despite a dynamic body of earnings management research that are well founded in economic theory, there have not been any attempts to take an integrated perspective (Beneish, 2001).This study integrates and well reconciles different research perspectives in the earnings management literature in attempt to provide a theoretical guidance for the future research. We first formulate a conceptual framework for understanding earnings management fundamental determinants based on market imperfection of information asymmetry and agency conflicts. We then highlight the arguments of opportunistic behaviour and signalling mechanism in order to address that earnings management is notnecessarily bad; it could be a device to enhance communication with external parties and improve internal efficiency. Finally, we review different managerial incentives that drive earnings management and we discuss the linkage between efficient contracting, opportunistic behaviour and signalling mechanism. |
| first_indexed | 2025-11-14T07:41:41Z |
| format | Journal Article |
| id | curtin-20.500.11937-21981 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T07:41:41Z |
| publishDate | 2008 |
| publisher | World Business Institute |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-219812017-03-08T13:10:46Z Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective Sun, L. Rath, Subhrendu agency costs Earnings management opportunistic behavior and signaling mechanism information asymmetry The systematic study of earnings management has now developed into a dynamic body of empirical literature. Despite a dynamic body of earnings management research that are well founded in economic theory, there have not been any attempts to take an integrated perspective (Beneish, 2001).This study integrates and well reconciles different research perspectives in the earnings management literature in attempt to provide a theoretical guidance for the future research. We first formulate a conceptual framework for understanding earnings management fundamental determinants based on market imperfection of information asymmetry and agency conflicts. We then highlight the arguments of opportunistic behaviour and signalling mechanism in order to address that earnings management is notnecessarily bad; it could be a device to enhance communication with external parties and improve internal efficiency. Finally, we review different managerial incentives that drive earnings management and we discuss the linkage between efficient contracting, opportunistic behaviour and signalling mechanism. 2008 Journal Article http://hdl.handle.net/20.500.11937/21981 World Business Institute restricted |
| spellingShingle | agency costs Earnings management opportunistic behavior and signaling mechanism information asymmetry Sun, L. Rath, Subhrendu Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title | Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title_full | Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title_fullStr | Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title_full_unstemmed | Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title_short | Fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| title_sort | fundamental determinants, opportunistic behavior and signaling mechanism: an integration of earnings management perspective |
| topic | agency costs Earnings management opportunistic behavior and signaling mechanism information asymmetry |
| url | http://hdl.handle.net/20.500.11937/21981 |