Earnings management during the COVID-19 crisis: evidence from the Brazilian and American capital markets

IF 3.2 Q1 BUSINESS, FINANCE Journal of Accounting in Emerging Economies Pub Date : 2023-01-31 DOI:10.1108/jaee-10-2021-0317
Eduardo da Silva Flores, J. Sampaio, A. Beiruth, Talles Vianna Brugni
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引用次数: 2

Abstract

PurposeThe main purpose of this study is to evaluate whether the COVID-19 pandemic has stimulated earnings management among publicly traded companies in Brazil and the USA.Design/methodology/approachThe authors analyzed the above-mentioned effects based on 22,244 observations of Brazilian companies and 139,856 observations of American companies from 1998 to 2020. The proxy used to detect earnings management based on discretionary accruals (DAC) was obtained by using the Modified Jones Model (MJM) (Dechow et al., 1995), with adjustments suggested by Kothari et al. (2005). In accordance with previous studies (e.g. Brown et al., 2015; Enomoto et al., 2015; Galdi et al., 2020; Huang and Sun, 2017; Roychowdhury, 2006), the authors also employed a second proxy to detect earnings management through real activities associated with unusual losses for fixed assets (property, plant and equipment (PPE)).FindingsThe study’s findings indicate that the discretionary accruals of Brazilian companies varied in a more accentuated manner during the COVID-19 pandemic, making it possible to deduce that a recent history of economic depression may entail greater incentives for earnings management in an emerging economy. In addition, the authors verified that the effects of the current crisis on earnings management proxies denote a signal that is distinct from previous economic crises, which may be interpreted as an attempt to postpone the effects of the pandemic on financial statements, especially those of the Brazilian capital markets.Originality/valueUnlike previous crises, this pandemic has led to direct restrictions on a wide variety of economic segments rather than indirect contagion due to anomalies in the financial markets, making it a phenomenon with the characteristics of a quasi-natural experiment for studies related to the quality of accounting information. Considering that both Brazil and the USA provide an opportune economic contrast, given their discrepancies in terms of economic growth over the past two decades, the researchers believe that there is an unusual opportunity to understand how earnings management can be an incentive for managers in environments where crises arose from natural causes.
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新冠肺炎危机期间的盈余管理:来自巴西和美国资本市场的证据
目的本研究的主要目的是评估新冠肺炎疫情是否刺激了巴西和美国上市公司的盈余管理。设计/方法/方法作者基于1998年至2020年对巴西公司的22244次观察和对美国公司的139856次观察,分析了上述影响。用于检测基于可自由支配应计利润(DAC)的盈余管理的代理是通过使用修正的琼斯模型(MJM)(Dechow等人,1995)获得的,Kothari等人建议进行调整。(2005)。根据先前的研究(例如,Brown等人,2015;Enomoto等人,2015年;Galdi等人,2020;Huang和Sun,2017;Roychowdhury,2006年),作者还使用了第二个代理来检测通过与固定资产(不动产、厂房和设备(PPE))异常损失相关的实际活动进行的盈余管理。研究结果表明,在新冠肺炎大流行期间,巴西公司的可自由支配应计项目变化更加突出,这就有可能推断出,最近的经济萧条史可能会给新兴经济体的盈余管理带来更大的激励。此外,作者证实,当前危机对盈余管理指标的影响表明了一个不同于以往经济危机的信号,这可能被解释为试图推迟疫情对财务报表的影响,特别是对巴西资本市场的影响。独创性/价值与以往的危机不同,这场疫情导致了对各种经济部门的直接限制,而不是由于金融市场的异常而间接传染,使其成为一种具有会计信息质量研究准自然实验特征的现象。考虑到巴西和美国在过去20年的经济增长方面存在差异,它们提供了一个恰当的经济对比,研究人员认为,在自然原因引发危机的环境中,有一个不同寻常的机会来了解盈余管理如何激励管理者。
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来源期刊
CiteScore
5.80
自引率
13.00%
发文量
38
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