Executive compensation and earnings management
Abstract This paper aims to estimate the relationship between incentive-based executive pay and earnings management. It focuses on a sample of public companies listed on the NASDAQ Stock Market, over a period from 2008 to 2016. Based on prior accounting research, this study applies the Jones model...
| Main Author: | |
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2017
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| Online Access: | https://eprints.nottingham.ac.uk/45710/ |
| _version_ | 1848797179224784896 |
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| author | LU, XIAOQIU |
| author_facet | LU, XIAOQIU |
| author_sort | LU, XIAOQIU |
| building | Nottingham Research Data Repository |
| collection | Online Access |
| description | Abstract
This paper aims to estimate the relationship between incentive-based executive pay and earnings management. It focuses on a sample of public companies listed on the NASDAQ Stock Market, over a period from 2008 to 2016. Based on prior accounting research, this study applies the Jones model to estimates the fixed-effects panel date model, and the research results show that bonuses are negatively correlated to earnings management, which implies that the agency problem can be mitigated through the design of CEO compensation packages. In addition, this paper finds that stock-based compensation has a positive impact on earnings manipulation, indicating that it needs careful consideration of the potential good and bad effects when companies make the use of high-powered incentives to motivate executives to maximise the value of companies. In this case, the monitoring departments should pay more attention to the quality of financial reports.
Keywords: Executive compensation, Earnings management, Bonuses, Stock options |
| first_indexed | 2025-11-14T19:59:46Z |
| format | Dissertation (University of Nottingham only) |
| id | nottingham-45710 |
| institution | University of Nottingham Malaysia Campus |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T19:59:46Z |
| publishDate | 2017 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | nottingham-457102018-04-10T15:36:06Z https://eprints.nottingham.ac.uk/45710/ Executive compensation and earnings management LU, XIAOQIU Abstract This paper aims to estimate the relationship between incentive-based executive pay and earnings management. It focuses on a sample of public companies listed on the NASDAQ Stock Market, over a period from 2008 to 2016. Based on prior accounting research, this study applies the Jones model to estimates the fixed-effects panel date model, and the research results show that bonuses are negatively correlated to earnings management, which implies that the agency problem can be mitigated through the design of CEO compensation packages. In addition, this paper finds that stock-based compensation has a positive impact on earnings manipulation, indicating that it needs careful consideration of the potential good and bad effects when companies make the use of high-powered incentives to motivate executives to maximise the value of companies. In this case, the monitoring departments should pay more attention to the quality of financial reports. Keywords: Executive compensation, Earnings management, Bonuses, Stock options 2017-09-11 Dissertation (University of Nottingham only) NonPeerReviewed application/pdf en https://eprints.nottingham.ac.uk/45710/1/Executive%20compensation%20and%20earnings%20management-LU%20Xiaoqiu.pdf LU, XIAOQIU (2017) Executive compensation and earnings management. [Dissertation (University of Nottingham only)] Keywords: Executive compensation Earnings management Bonuses Stock options |
| spellingShingle | Keywords: Executive compensation Earnings management Bonuses Stock options LU, XIAOQIU Executive compensation and earnings management |
| title | Executive compensation and earnings management |
| title_full | Executive compensation and earnings management |
| title_fullStr | Executive compensation and earnings management |
| title_full_unstemmed | Executive compensation and earnings management |
| title_short | Executive compensation and earnings management |
| title_sort | executive compensation and earnings management |
| topic | Keywords: Executive compensation Earnings management Bonuses Stock options |
| url | https://eprints.nottingham.ac.uk/45710/ |