Auditing, Earnings Management, Governance

When companies report their financial results, managers face both the discretion and the temptation to shape those numbers in ways that serve their own interests rather than investors'—a practice known as earnings management. Researchers in this area study how institutional safeguards, particularly audit committees, corporate governance structures, and accounting standards like IFRS, constrain or fail to constrain that behavior, and how the resulting quality of reported figures affects the information gap between insiders and outside investors. A central open question is how effectively governance mechanisms translate into genuine accounting quality across different legal and institutional environments, especially as standard-setting becomes more globally harmonized. Active work also examines how financial analysts process and discipline disclosure practices, and whether their scrutiny substitutes for or complements formal oversight.

Works

122,292

Total citations

2,121,864

Keywords

Earnings ManagementFinancial ReportingAudit CommitteeAccounting QualityCorporate GovernanceAccruals Quality