دانلود رایگان مقاله انگلیسی مدیریت سود واقعی در جامعه در مقابل شرکت های خصوصی در کشورهای شورای همکاری خلیج فارس - امرالد 2017

Abstract

Purpose: The purpose of this paper is to examine the use of real earnings management by private and public firms in a unique institutional setting, which is the Gulf Cooperation Council (hereafter GCC) countries. The paper also compares the level of real earnings management between public and private firms in the GCC area. Design/methodology/approach: The GCC area is a unique setting to investigate the use of real earnings management because of the low enforcement of reporting standards and supervisory rules, lack of sophisticated financial analysis, specialized media tools and high concentration of capital ownership. We use different models of real earnings management proposed by (Roychowdhury, 2006); cash flow management, productions cost management and discretionary expenses management to examine the use of real earnings management. Findings: The paper documents evidence consistent with private and public firms using real earnings management to influence their earnings figures. The paper also, shows that the level of real earnings management is higher for private firms compared to public firms when cash flow management and discretionary expenses management models are used. The production cost model results show evidence consistent with public firms only engaging in real earnings management through production cost reduction. Practical implications: The findings of this study should promote a general understanding of firms’ behaviour in unique environment such as GCC countries. Regulators in the GCC region should be aware that real earnings management techniques have been used by firms and that extra caution is required when auditing or analysing the financial information of private and public firms in the GCC market. Originality/value: This paper contributes to the literature in many aspects. First, it provides additional evidence on the use of earnings management in unique market contexts outside the US and Europe. The GCC markets share many common characteristics that make them interesting settings to be investigated. Second, this paper adds more evidence on the use of earnings management between public and private firms. In this regard, the paper adds additional evidence in the discussions proposed by Ball and Shivakumar (2005) and Givoly et al (2010) who use two competing perspectives to investigate earnings quality in public and private firms; the demand hypothesis and the opportunistic behaviour hypothesis.

Conclusion

The purpose of this study is to investigate the use of real earnings management techniques by firms in GCC counties. Specifically, we investigate and compare the use of real earrings management in public and private firms in GCC countries. The study is motivated by the fact that GCC countries constitute an interesting setting to test the implications of financial reporting choices for various types of firms. On one hand, research investigating real earnings management practices in developing economies including the GCC region is limited or missing. Given the fact that a significant part of global oil supply is coming from the GCC countries, the importance of these economies to the world should not be overlooked. As a result, research investigating the nature and the implications of financial reporting choices by firms in the GCC area is highly needed. Also, GCC countries possess high amounts of surplus liquidity of which some part is reinvested into the economies in the form of capital ownership in publicly listed firms by governments. As a result, firms in these countries are characterized by concentrated ownership. Furthermore, lack of high standards of corporate governance and sophisticated financial analysts and forecasts coupled with limited enforceability of corporate disclosure and regulations makes the markets in these countries more prone to information asymmetry problems. Finally, research evidence from some GCC markets reveals an intriguing feature in these markets; namely, the negative association between leverage and firm performance, which is contrary to traditional finance theory. The above mentioned attributes have been shown by prior research to have an effect on corporate reporting choices by firms. As a result, contributing evidence from an additional setting such as the GCC market is expected to add more insight on the corporate reporting behaviour of firms operating in this market. Using a unique data of GCC countries for the period of 2003-2012 and employing different models that represent different techniques of real earnings management, the results show that both public and private firms in the GCC countries engage in real earnings management. However, the nature and the level of real earnings management techniques is different between private and public firms.