Yaari 7). Earnings management has been a very controversial topic among business enterprises. In the accounting world‚ earnings management is increasing becoming an area of interest to many people including government regulators‚ SEC and stakeholders. Earnings management is defined as the use of accounting techniques to produce financial reports that may paint an overly positive picture of a company’s financial position (“Earnings Management” 1). Ethics and integrity are key aspects of earnings management
Premium Financial statements Balance sheet Enron
Earnings Management and Its Implications Educating the Accounting Profession By Michael D. Akers‚ Don E. Giacomino‚ and Jodi L. Bellovary August 2007 Issue AUGUST 2007 - In the wake of continuing‚ highly publicized E-mail Story financial frauds and failures‚ the accounting profession has placed renewed emphasis on issues related to earnings Print Story management and earnings quality. The SEC and the public are demanding greater assurance about the quality of earnings. Staff Accounting Bulletin
Premium Business ethics Financial statements Balance sheet
1. What is earnings management? The companies use earnings management as a strategy by which they can easily control and manipulate their earnings to reach their pre-determined earning target. 2. Why do companies employ earnings management techniques? Accountants cannot predict every business structure‚ every new and innovative transaction. Therefore‚ they build up principles that allow for flexibility so that they can adapt to changing circumstances. However‚ people make use of that flexibility
Premium Generally Accepted Accounting Principles Financial statements Enron
reported earnings and the reasons behind each way may be different. (1) Report lower earnings. Managers intend to report lower earnings for mainly three reasons. Firstly‚ they want to hide profit for future use. In some years‚ the company presents a strong performance and has earned huge profit; however the manager may worry that the company’s future performance would not be as strong as current year‚ which gives them the incentive to save the profit by reporting a managed lower earning‚ so that
Premium Audit Auditing
Earnings management is typically regarded as a bad thing. I will cover why it’s considered a bad thing‚ and what it entails. When an executive “cooks the books” it’s referring to them providing false information in order to deceive other important employees or shareholders. This act includes‚ but is not limited to: falsifying receipts‚ inventories‚ balance sheets‚ and/or cash flow statements. This is an important concept to familiarize yourself with because‚ if identified and stopped in time‚ could
Premium Accounting scandals Arthur Andersen Enron
Cult Activities and Psychological Manipulation Cultic activity is all around us and we don’t even know it. People around the world are being psychologically manipulated (brain washed) in these cults and they are not even aware of the control that someone has over them. As I checked out the links on the Ex-Cult Resource Center Website I found some very interesting information as well as the different types of cults‚ some religious and some not religious. It is sad that manipulation would
Premium Cult New religious movement Religion
HUB HUB RESEARCH PAPER Earnings management: a literature review S. Verbruggen‚ J. Christaens‚ and K. Milis HUB RESEARCH PAPER 2008/14. FEBRUARI 2008 Hogeschool – Universiteit Brussel Stormstraat 2‚ 1000 Brussel‚ Belgium T: +32 2 210 12 11 F: + 32 2 217 64 64 Earnings management: a literature review S. Verbruggen‚ Hogeschool Universiteit Brussel Prof dr. J. Christaens‚ Universiteit Gent Prof. dr. K. Milis‚ Hogeschool Universiteit Brussel Abstract Based on a literature review of major
Premium Management Stock market Financial statements
Earning management is good or not? Introdcution This essay is to examine whether earning management is it good or bad. Though there is so many debate about whether it should be accepted to be good rather than bad‚ however‚ this essay will explain the both side of earnings management. Earnings management reduces the quality of financial reporting‚ it can interfere with the resource allocation in the economy and can bring adverse consequences to the financial market. This essay analyses both‚ causes
Premium Generally Accepted Accounting Principles Contract Management
Manipulation and Impression Management can have negative and positive traits within interpersonal communication. Emotional intelligence and impression management is often used to manipulate and deceive people. Though this can be viewed as a positive trait‚ it has negative outcomes for the person being deceptive. While deception is common in everyday social interactions its prevalence is less widely discussed. This essay will define impression management‚ deception and how individuals manipulate
Premium Communication Sociology Social psychology
Future Earnings Management Activities at Maynard Manufacturing Company (Page 54) Examples | GAAP-based | Latitude by GAAP | Fraud? | 1 | Yes | Yes (Gray Area) | No | 2 | Yes | Yes (Gray Area) | No | 3 | Yes | Yes (Black Area) | No | 4 | Yes | Yes (White Area) | No | 5 | Yes | Yes (Gray Area) | No | 6 | Yes | Yes (Black Area) | No | 7 | Yes | Yes (Black Area) | Yes | 8 | Yes | Yes (White Area) | No | 9 | No | Black Area | Yes | 10 | Yes | Yes (White Area) | No | 11 | Yes |
Premium Generally Accepted Accounting Principles Depreciation Manufacturing