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The influence of institutional investors on opportunistic earnings management

The influence of institutional investors on opportunistic earnings management Recent debates on institutional investors and their impact on corporate managers' accounting decisions have especially centred on the effectiveness of their monitoring role. Previous studies have reported mixed results on this question. This paper empirically examines the influence of institutional investors on earnings management in France. The results show that these investors can move corporate managers away from using discretionary accruals to adjust reported earnings. However, this influence is not systematic. It appears to be released only when managers are noticeably motivated to increase or reduce reported earnings. Otherwise, no statistically significant effect is observed. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Accounting, Auditing and Performance Evaluation Inderscience Publishers

The influence of institutional investors on opportunistic earnings management

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References (38)

Publisher
Inderscience Publishers
Copyright
Copyright © Inderscience Enterprises Ltd. All rights reserved
ISSN
1740-8008
eISSN
1740-8016
DOI
10.1504/IJAAPE.2008.020195
Publisher site
See Article on Publisher Site

Abstract

Recent debates on institutional investors and their impact on corporate managers' accounting decisions have especially centred on the effectiveness of their monitoring role. Previous studies have reported mixed results on this question. This paper empirically examines the influence of institutional investors on earnings management in France. The results show that these investors can move corporate managers away from using discretionary accruals to adjust reported earnings. However, this influence is not systematic. It appears to be released only when managers are noticeably motivated to increase or reduce reported earnings. Otherwise, no statistically significant effect is observed.

Journal

International Journal of Accounting, Auditing and Performance EvaluationInderscience Publishers

Published: Jan 1, 2008

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