Teaching Note on How the Earnings Management Teaching Module Can Be Taught Teaching Aims of the Module The Earnings Management Teaching Module is designed to help faculty teach how companies might manipulate earnings to maximize revenues‚ minimize expenses‚ and/or create reserves by setting aside some earnings in the current period that can be released into income at a later period. The result is to overstate earnings and mislead shareholders and creditors about the success of the company
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Determinants of Earnings Improving someone’s success in the labour market is a main objective of both family and policy makers‚ especially those with low earning in recent years. In the classic view of labour earning‚ we assume that the skills of individuals are the dominant factor to determine the earnings’ level. However‚ the recent year study manifests multiple factors have been weighed more than before. To illustrate this new situation‚ it believes that individuals’ successes in labour
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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
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Overview of Quality of Earnings - Some Guiding Principles/Framework The issue of earnings quality arises because of the cost/benefit trade off between cash accounting and accrual accounting. For our purposes‚ we want reported earnings to do two things: 1) to accurately represent current operating performance 2) to aid in accurately forecasting future operating performance These requirements for high-quality earnings mean that the reported earnings amounts for a particular period
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COMPARATIVE STUDY OF RETAINED EARNINGS OF LUPIN v/s WYETH INTRODUCTION Managing a company’s operations‚ marketing and sales activities and expense management are but a few of the decisions that management has to deal with. After it has made a profit the company will then need to decide what to do with those profits. Among the options for using profits are: operations‚ returning cash to shareholders‚ or keeping cash in reserve for future use Retained earnings represent the amount a company
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Price-to-earnings ratio (P/E) is often used for assessing the company’s stock price. P/E is determined by first calculating the earnings per shares (EPS)‚ which is the post-tax profits divides by the number of shares (Figure 1). Trailing P/E is equal to current market share price divided by trailing earnings per share for the past 12 months‚ whereas forward P/E is equal to current share price divided by expected earnings per shares for the next 12 months or next full-year fiscal period (http://www
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Project Earnings Manipulation: An Ethics Case Based on Agency Theory ABSTRACT: The impact of accounting information on ethical behavior has been extensively documented. Additionally‚ agency theory is a widely accepted behavioral perspective. Despite this‚ there is an absence of instructional material in the accounting education literature that ties ethical issues to an agency-theory context. The primary objective of this case is to highlight control system ethical issues using an agency-theory context
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Vis a vis morality‚ for us to lay the foundation of the understanding of the term‚ I deemed it necessary to search for its meaning and I found in Cambridge Advanced Learners Dictionary: Third Edition that morality is a personal or social set of standards for good or bad behavior and character or the quality of being right‚ honest‚ or acceptable. Taking from the definition itself‚ we can draw out a conclusion that morality is more of a personal encounter of what is morally good or right. It might
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Business Ethics Lesson 2: Morality and Moral Standards In the first lecture I have tried to explain you the concept of Business Ethics‚ its importance in the organization‚ and arguments against its implementation. Along with that we did a small activity so as to make everything clear. In this lecture I shall talk about morality and moral standards. Points to be covered in this lecture: Meaning and characteristics of morality Meaning and origin of moral standards MORALITY What do you actually
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On Morality/ By Joan Didion As it happens I am in Death Valley‚ in a room at the Enterprise Motel and Trailer Park‚ and it is July‚ and it is hot. In fact it is 119°. I cannot seem to make the air conditioner work‚ but there is a small refrigerator‚ and I can wrap ice cubes in a towel and hold them against the small of my back. With the help of the ice cubes I have been trying to think‚ because The American Scholar asked me to‚ in some abstract way about “morality‚” a word I distrust more every
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