Accruals Management to Achieve Earnings Benchmarks: A Comparison of Pre-managed Profit and Loss Firms

@inproceedings{Barua2006AccrualsMT,
  title={Accruals Management to Achieve Earnings Benchmarks: A Comparison of Pre-managed Profit and Loss Firms},
  author={Abhijit Barua and Joseph Legoria and Jacquelyn Sue Moffitt},
  year={2006}
}
This study examines whether firms with profits before accruals management are more likely than firms with losses before accruals management to meet or exceed earnings benchmarks when pre-managed earnings are below those benchmarks. We extend Brown (2001) by documenting that the differential propensity to achieve earnings benchmarks by profitable and nonprofitable firms results from differential accruals management behavior. We find that firms with profits before accruals management are more… CONTINUE READING

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