Forecasting the level of earnings management of Russian and Chinese companies
| Autor: | Anna E. Loukianova, Egor D. Nikulin, Andrey A. Zinchenko |
|---|---|
| Jazyk: | angličtina |
| Rok vydání: | 2017 |
| Předmět: |
Economics and Econometrics
China 050208 finance Index (economics) business.industry Strategy and Management 05 social sciences Scopus Accounting forecasting 050201 accounting Russia World Wide Web Earnings management 0502 economics and business decision tree lcsh:Finance lcsh:HG1-9999 Business Business and International Management Publication Finance earnings management |
| Zdroj: | Investment Management & Financial Innovations, Vol 14, Iss 2, Pp 264-280 (2017) |
| ISSN: | 1812-9358 1810-4967 |
| Popis: | The purpose of the current paper is to elaborate a model to forecast a particular type of earnings management by companies: upward earnings management, downward earnings management or the absence of significant manipulation. The sample analyzed in the current paper comprises 664 Russian and 2,380 Chinese public companies for the period 2009-2014. The forecast was made for 2014 based on annual accounting data for 2009-2013. Regression analysis, as well as Classification and Regression Tree modelling (CART), were used. The data forecast for 2014 was compared with actual data for that year, and the accuracy of the forecasting model was assessed. The paper outlines the main conditions under which a particular type of earnings manipulation is expected to take place in a company in the accounting period following the current one. It is shown that the main factor influencing the company’s level of earnings manipulation of the next accounting period for both Russian and Chinese companies is the debt ratio calculated as the ratio of total liabilities to total assets. The other important factors are: the company size, return on equity, earnings persistence, the level of earnings manipulation in the current period and stock emission. |
| Databáze: | OpenAIRE |
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