دانلود رایگان مقاله انگلیسی تاثیر قدرت نفوذ بر مدیریت درآمد مبتنی بر تعهد: مورد شرکت های ذکر شده در فرانسه - الزویر 2018

Abstract:

The primary aim of this study is to examine the impact of leverage increases on accrual-based earnings management practices for a sample of French firms indexed in CAC All-Tradable during a period from 2006 to 2012. We use panel data to calculate discretionary accruals and to empirically analyze the effect of firm leverage on the opportunistic behavior of managers. Consistent with debt covenants hypothesis, we find that firm leverage has a positive effect on earnings management for French firms. The empirical results show that leverage increases provide incentives for managers to manipulate earnings.

6. Conclusion

In this paper, we have empirically investigated the impact of leverage increases on extent of accrual-based earnings management in the French context. We are particularly interested in leverage increasing firms, which have low leverage at the beginning and high leverage at the end of sample period, and highly leveraged firms, which have consistently higher leverage. After an empirical analysis of the impact of leverage on earnings management, we find that leverage has a positive effect on earnings management. Our findings suggest a significantly positive association between the absolute value of discretionary accruals and leverage. The empirical results obtained support the literature of debt covenants, which argues that highly leveraged firms have to meet the expectations of investors, and subsequently, they have engaged in the practice of earnings management. Thus, debt provides the framework for the emergence and rise of earnings management. Indeed, the debt loses its disciplinary role, as recommended in financial theory, to provide the incentives for managers to manipulate earnings. In addition, we found that firms that undergo long-term debt increases during the sample period are more likely to manage their earnings than highly leveraged firms. In other words, the leverage increases are a source of motivation for accrual-based eanings management. This research has some limitations. First, we have not measured the opportunistic behavior of managers directly but we just estimated it through the creation of accruals. Second, we have not considered the determinants of managerial discretion (managerial ownership, external directors, audit committee structure). In future research, we can analyze the effect of a firmspecific characteristic on the relation between leverage and earnings management. Moreover, we can differentiate the impact of public and private debts on this relationship between earnings management and leverage focusing on different nature of supervision by public and private debt holders.