Manipulação para Evitar Perdas: o Impacto do Conservantismo

José António Moreira ()
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José António Moreira: CETE, Faculdade de Economia, Universidade do Porto

CEF.UP Working Papers from Universidade do Porto, Faculdade de Economia do Porto

Abstract: In this paper I analyze the interaction between firms’ earnings management behavior and conservatism. I predict that firms having conservatism-related bad news in the period have more pervasive earnings management than firms having good news. Departing from Burgstahler and Dichev (1997) methodology to detect earnings management, and taking the sign of market returns as a proxy for conservatism effects, I find empirical evidence that supports the prediction of an interaction between firms’ earnings management behavior and conservatism. The evidence is thus consistent with the discontinuities around zero in the earnings distributions being driven, at least partly, by firms’ earnings management behavior, and is robust to controlling for other effects mentioned in the literature as potential determinants of such discontinuities.

Keywords: Earnings management; conservatism; earnings distribution discontinuities. (search for similar items in EconPapers)
JEL-codes: C21 L29 M41 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2006-05
New Economics Papers: this item is included in nep-acc
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:por:cetedp:0605

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