Firm- and Country-Level Attributes as Determinants of Earnings Management: An Analysis for Latin American Firms

References

• Akerlof, G. 1970. The market for “lemons”: Quality uncertainty and the market mechanism. The Quarterly Journal of Economics 84 (3):488–500. doi:10.2307/1879431.
   Web of Science ®Google Scholar
• Ali, S. M., N. M. Salleh, and M. S. Hassan. 2008. Ownership structure and earnings management in malaysian listed companies: The size effect. Asian Journal of Business and Accounting 1 (2):89–116.
   Google Scholar
• Altman, E. I. 1968. Financial ratios, discriminant analysis and the prediction of corporate bankruptcy. The Journal of Finance 23 (4):589–609. doi:10.1111/j.1540-6261.1968.tb00843.x.
   Web of Science ®Google Scholar
• Altman, E. I. 2005. An emerging market credit scoring system for corporate bonds. Emerging Markets Review 6 (4):311–23. doi:10.1016/j.ememar.2005.09.007.
   Google Scholar
• Alves, S. 2012. Ownership structure and earnings management: Evidence from Portugal. Australian Accounting, Business and Finance Journal 6 (1):57–74.
   Google Scholar
• Ang, J. S., R. A. Cole, and J. W. Lin. 2000. Agency costs and ownership structure. The Journal of Finance 55 (1):81–106. doi:10.1111/0022-1082.00201.
   Web of Science ®Google Scholar
• Anglin, P., R. Edelstein, Y. Gao, and D. Tsang. 2013. What is the relationship between REIT governance and earnings management? The Journal of Real Estate Finance and Economics 47 (3):538–63. doi:10.1007/s11146-012-9367-y.
   Web of Science ®Google Scholar
• Arellano, M. 2002. Sargan’s instrumental variables estimation and the generalized method of moments. Journal of Business & Economic Statistics 20 (4):450–59. doi:10.1198/073500102288618595.
   Web of Science ®Google Scholar
• Arellano, M., and O. Bover. 1990. La econometría de datos de panel. Investigaciones Económicas (Segunda Época) 14 (1):3–45.
   Google Scholar
• Atieh, A., and S. Hussain. 2012. Do UK firms manage earnings to meet dividend thresholds? Accounting and Business Research 42 (1):77–94. doi:10.1080/00014788.2012.622187.
   Web of Science ®Google Scholar
• Ball, R., S. P. Kothari, and A. Robin. 2000. The effect of international institutional factors on properties of accounting earnings. Journal of Accounting and Economics 29 (1):1–51. doi:10.1016/S0165-4101(00)00012-4.
   Web of Science ®Google Scholar
• Ball, R., A. Robin, and J. S. Wu. 2003. Incentives versus standards: Properties of accounting income in four East Asian countries. Journal of Accounting and Economics 36 (1–3):235–70. doi:10.1016/j.jacceco.2003.10.003.
   Web of Science ®Google Scholar
• Barth, M. E., D. P. Cram, and K. K. Nelson. 2001. Accruals and the prediction of future cash flows. The Accounting Review 76 (1):27–58. doi:10.2307/3068843.
   Web of Science ®Google Scholar
• Barth, M. E., W. R. Landsman, and M. H. Lang. 2008. International accounting standards and accounting quality. Journal of Accounting Research 46 (3):467–98. doi:10.2307/40058143.
   Web of Science ®Google Scholar
• Baum, C. F., M. E. Schaffer, and S. Stillman. 2003. Instrumental variables and GMM: Estimation and testing. Stata Journal 3 (1):1–31.
   Web of Science ®Google Scholar
• Beattie, V., S. Brown, D. Ewers, B. John, S. Manson, D. Thomas, and M. Turner. 1994. Extraordinary items and income smoothing: A positive accounting approach. Journal of Business Finance & Accounting 21 (6):791–811. doi:10.1111/j.1468-5957.1994.tb00349.x.
   Google Scholar
• Bebchuk, L. A., and A. Hamdani. 2009. The elusive quest for global governance standards. University of Pennsylvania Law Review 157 (5):1263–317. doi:10.2307/40380267.
   Web of Science ®Google Scholar
• Beck, T., A. Demirgüç-Kunt, and R. Levine. 2000. A new database on the structure and development of the financial sector. World Bank Economic Review 14 (3):597–605. doi:10.1093/wber/14.3.597.
   Web of Science ®Google Scholar
• Becker, C. L., M. L. Defond, J. Jiambalvo, and K. R. Subramanyam. 1998. The effect of audit quality on earnings management. Contemporary Accounting Research 15 (1):1–24. doi:10.1111/j.1911-3846.1998.tb00547.x.
   Google Scholar
• Beneish, M. D., C. M. C. Lee, and D. C. Nichols. 2013. Earnings manipulation and expected returns. Financial Analysts Journal 69 (2):57–82. doi:10.2469/faj.v69.n5.8.
   Web of Science ®Google Scholar
• Blundell, R., and S. Bond. 1998. Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics 87 (1):115–43. doi:10.1016/S0304-4076(98)00009-8.
   Web of Science ®Google Scholar
• Bond, S. 2002. Dynamic panel data models: A guide to micro data methods and practice. Portuguese Economic Journal 1 (2):141–62. doi:10.1007/s10258-002-0009-9.
   Google Scholar
• Bottazzi, L., M. Da Rin, and T. Hellmann. 2009. What is the role of legal systems in financial intermediation? Theory and evidence. Journal of Financial Intermediation 18 (4):559–98. doi:10.1016/j.jfi.2008.04.003.
   Web of Science ®Google Scholar
• Brav, A., J. Graham, C. Harvey, and R. Michaely. 2005. Payout policy in the 21st century. Journal of Financial Economics 77 (3):483–527. doi:10.1016/j.jfineco.2004.07.004.
   Web of Science ®Google Scholar
• Brown, P., W. Beekes, and P. Verhoeven. 2011. Corporate governance, accounting and finance: A review. Accounting & Finance 51 (1):96–172. doi:10.1111/j.1467-629X.2010.00385.x.
   Web of Science ®Google Scholar
• Claessens, S., and B. B. Yurtoglu. 2013. Corporate governance in emerging markets: A survey. Emerging Markets Review 15:1–33. doi:10.1016/j.ememar.2012.03.002.
   Web of Science ®Google Scholar
• Cohen, D. A., A. Dey, and T. Z. Lys. 2008. Real and accrual-based earnings management in the pre- and post- sarbanes-oxley periods. The Accounting Review 83 (3):757–87. doi:10.2308/accr.2008.83.3.757.
   Web of Science ®Google Scholar
• Daniel, N. D., D. J. Denis, and L. Naveen. 2008. Do firms manage earnings to meet dividend thresholds? Journal of Accounting and Economics 45 (1):2–26. doi:10.1016/j.jacceco.2007.11.002.
   Web of Science ®Google Scholar
• Davidson, R., J. Goodwin-Stewart, and P. Kent. 2005. Internal governance structures and earnings management. Accounting & Finance 45 (2):241–67. doi:10.1111/j.1467-629x.2004.00132.x.
   Google Scholar
• Dechow, P. M., R. G. Sloan, and A. P. Sweeney. 1995. Detecting earnings management. Accounting Review 70 (2):193–225.
   Web of Science ®Google Scholar
• Dechow, P. M., R. G. Sloan, and A. P. Sweeney. 1996. Causes and consequences of earnings manipulation: An analysis of firms subject to enforcement actions by the SEC. Contemporary Accounting Research 13 (1):1–36. doi:10.1111/j.1911-3846.1996.tb00489.x.
   Google Scholar
• Degeorge, F., Y. Ding, T. Jeanjean, and H. Stolowy. 2013. Analyst coverage, earnings management and financial development: An international study. Journal of Accounting and Public Policy 32 (1):1–25. doi:10.1016/j.jaccpubpol.2012.10.003.
   Web of Science ®Google Scholar
• Dichev, I., J. Graham, C. R. Harvey, and S. Rajgopal. 2016. The Misrepresentation of Earnings. Financial Analysts Journal 72 (1):22–35. doi:10.2469/faj.v72.n1.4.
   Web of Science ®Google Scholar
• Easterbrook, F. H. 1984. Two agency-cost explanations of dividends. The American Economic Review 74 (4):650–59.
   Web of Science ®Google Scholar
• Edelstein, R. H., P. Liu, and D. Tsang. 2008. Real earnings management and dividend payout signals: A study for US real state investment trusts. CAAA, Annual Conference Paper. https://ssrn.com/abstract=1079984.
   Google Scholar
• Enomoto, E., F. Kimura, and T. Yamaguchi 2014. A cross-country study on the relationship between financial development and earnings management. Discussion Paper Series RIEB Kobe University, (DP2013-34). Research Institute for Economics and Business Administration, Kobe.
   Google Scholar
• Erkens, D. H., M. Hung, and P. Matos. 2012. Corporate governance in the 2007–2008 financial crisis: Evidence from financial institutions worldwide. Journal of Corporate Finance 18 (2):389–411. doi:10.1016/j.jcorpfin.2012.01.005.
   Web of Science ®Google Scholar
• Espinosa, C. 2009. Estructura de propiedad y desempeño de la firma: El caso chileno. Academia, Revista Latinoamericana De Administración 43:41–62.
   Google Scholar
• Frank, M. Z., and V. K. Goyal. 2009. Capital structure decisions: Which factors are reliably important? Financial Management 38 (1):1–37. doi:10.1111/j.1755-053X.2009.01026.x.
   Web of Science ®Google Scholar
• Gabrielsen, G., J. D. Gramlich, and T. Plenborg. 2002. Managerial ownership, information content of earnings, and discretionary accruals in a non–US setting. Journal of Business Finance & Accounting 29 (7–8):967–88. doi:10.1111/1468-5957.00457.
   Google Scholar
• García-Meca, E., and J. P. Sánchez-Ballesta. 2009. Corporate governance and earnings management: A meta-analysis. Corporate Governance: An International Review 17 (5):594–610. doi:10.1111/j.1467-8683.2009.00753.x.
   Web of Science ®Google Scholar
• Han, S., T. Kang, S. Salter, and Y. K. Yoo. 2008. A cross-country study on the effects of national culture on earnings management. Journal of International Business Studies 41 (1):123–41. doi:10.1057/jibs.2008.78.
   Web of Science ®Google Scholar
• Hansen, L. P., J. Heaton, and A. Yaron. 1996. Finite-sample properties of some alternative GMM estimators. Journal of Business & Economic Statistics 14 (3):262–80.
   Web of Science ®Google Scholar
• Harris, M., and A. Raviv. 1991. The theory of capital structure. The Journal of Finance 46 (1):297–355. doi:10.1111/j.1540-6261.1991.tb03753.x.
   Web of Science ®Google Scholar
• He, W., L. Ng, N. Zaiats, and B. Zhang. 2017. Dividend policy and earnings management across countries. Journal of Corporate Finance 42:267–86. doi:10.1016/j.jcorpfin.2016.11.014.
   Web of Science ®Google Scholar
• Ho, L.-C. J., Q. Liao, and M. Taylor. 2015. Real and accrual-based earnings management in the pre- and post-IFRS periods: Evidence from China. Journal of International Financial Management & Accounting 26 (3):294–335. doi:10.1111/jifm.12030.
   Web of Science ®Google Scholar
• Hope, O.-K. 2003. Firm-level disclosures and the relative roles of culture and legal origin. Journal of International Financial Management & Accounting 14 (3):218–48. doi:10.1111/1467-646X.00097.
   Google Scholar
• Huang, H. H., W. Wang, and J. Zhou. 2013. Shareholder rights, insider ownership and earnings management. Abacus 49 (1):46–73. doi:10.1111/j.1467-6281.2012.00390.x.
   Web of Science ®Google Scholar
• Hunsaker, J. 1999. The role of debt and bankruptcy statutes in facilitating tacit collusion. Managerial and Decision Economics 20 (1):9–24. doi:10.1002/(sici)1099-1468(199902)20:1<9::aid-mde916>3.0.co;2-#.
   Google Scholar
• Jensen, M. C. 1986. Agency cost of free cash flow, corporate finance, and takeovers. The American Economic Review 72 (6):323–29.
   Google Scholar
• Jensen, M. C. 1994. Self-interest, altruism, incentives, and agency theory. Journal of Applied Corporate Finance 7 (2):40–45. doi:10.1111/j.1745-6622.1994.tb00404.x.
   Google Scholar
• Jensen, M. C. 2003. Paying people to lie: The truth about the budgeting process. European Financial Management 9 (3):379–406. doi:10.1111/1468-036x.00226.
   Google Scholar
• Jensen, M. C., and W. Meckling. 1976. Theory of the firm: Managerial behaviour, agency cost and ownership structure. Journal of Financial Economics 3 (4):305–60. doi:10.1016/0304-405X(76)90026-X.
   Web of Science ®Google Scholar
• Jones, J. J. 1991. Earnings management during import relief investigations. Journal of Accounting Research 29 (2):193–228. doi:10.2307/2491047.
   Web of Science ®Google Scholar
• Kabir, M. H., F. Laswad, and M. A. Islam. 2010. Impact of IFRS in New Zealand on accounts and earnings quality. Australian Accounting Review 20 (4):343–57. doi:10.1111/auar.2010.20.issue-4.
   Web of Science ®Google Scholar
• Kaufmann, D., A. Kraay, and M. Mastruzzi. 2011. The worldwide governance indicators: Methodology and analytical issues. Hague Journal of the Rule of Law 3 (2):220–46. doi:10.1017/s1876404511200046.
   Web of Science ®Google Scholar
• Khanna, T., and K. Palepu. 2000. The future of business groups in emerging markets: Long-Run evidence from Chile. The Academy of Management Journal 43 (3):268–85. doi:10.2307/1556395.
   Web of Science ®Google Scholar
• La Porta, R., F. Lopez-De-Silanes, A. Shleifer, and R. Vishny. 2000. Agency problems and dividend policies around the world. The Journal of Finance 55 (1):1–33. doi:10.1111/0022-1082.00199.
   Web of Science ®Google Scholar
• Lefort, F. 2005. Ownership structure and corporate governance in Latin America. Revista ABANTE 8 (1):55–84.
   Google Scholar
• Leuz, C., D. Nanda, and P. D. Wysocki. 2003. Earnings management and investor protection: An international comparison. Journal of Financial Economics 69 (3):505–27. doi:10.1016/S0304-405X(03)00121-1.
   Web of Science ®Google Scholar
• Lind, J. T., and H. Mehlum. 2010. With or without U? The appropriate test for a U-Shaped relationship. Oxford Bulletin of Economics and Statistics 72 (1):109–18. doi:10.1111/j.1468-0084.2009.00569.x.
   Web of Science ®Google Scholar
• Lintner, J. 1956. Distribution of incomes of corporations among dividends, retained earnings, and Taxes. The American Economic Review 46 (2):97–113. doi:10.2307/1910664.
   Web of Science ®Google Scholar
• Lobo, G. J., and J. Zhou. 2006. Did conservatism in financial reporting increase after the sarbanes-oxley act? Initial evidence. Accounting Horizons 20 (1):57–73. doi:10.2308/acch.2006.20.1.57.
   Google Scholar
• López, F., and P. Saona. 2005. Earnings management and internal mechanisms of corporate governance: Empirical evidence from Chilean firms. Corporate Ownership & Control 3 (1):17–29.
   Google Scholar
• Mitton, T. 2004. Corporate governance and dividend policy in emerging markets. Emerging Markets Review 5 (4):409–26. doi:10.1016/j.ememar.2004.05.003.
   Google Scholar
• Mohrman, M. B. 1996. The use of fixed GAAP provisions in debt contracts. Accounting Horizons 10 (3):78–91.
   Google Scholar
• Morck, R., A. Shleifer, and R. W. Vishny. 1988. Management ownership and market valuation: An empirical analysis. Journal of Financial Economics 20:293–315. doi:10.1016/0304-405x(88)90048-7.
   Web of Science ®Google Scholar
• Pelucio-Grecco, M. C., C. M. Geron, G. Begas, and J. P. Cavalcante. 2014. The effect of IFRS on earnings management in Brazilian non-financial public companies. Emerging Markets Review 21:42–66. doi:10.1016/j.ememar.2014.07.001.
   Web of Science ®Google Scholar
• Richardson, S., I. Tuna, and M. Wu. 2002. Predicting earnings management: The case of earnings restatements. https://ssrn.com/abstract=338681
   Google Scholar
• Sáenz, J., and E. García-Meca. 2014. Does corporate governance influence earnings management in latin american markets? Journal of Business Ethics 121 (3):419–40. doi:10.1007/s10551-013-1700-8.
   Web of Science ®Google Scholar
• Sánchez-Ballesta, J. P., and E. García-Meca. 2007. Ownership structure, discretionary accruals and the informativeness of earnings. Corporate Governance: An International Review 15 (4):677–91. doi:10.1111/j.1467-8683.2007.00596.x.
   Web of Science ®Google Scholar
• Saona, P., and E. Vallelado. 2012. Firms’ capital structure under akerlof’s separating equilibrium. Spanish Journal of Finance and Accounting XLI (156):471–95.
   Google Scholar
• Shen, C.-H., and H.-L. Chih. 2005. Investor protection, prospect theory, and earnings management: An international comparison of the banking industry. Journal of Banking & Finance 29 (10):2675–97. doi:10.1016/j.jbankfin.2004.10.004.
   Web of Science ®Google Scholar
• Shen, C.-H., and H.-L. Chih. 2007. Earnings management and corporate governance in Asia’s emerging markets. Corporate Governance: An International Review 15 (5):999–1021. doi:10.1111/j.1467-8683.2007.00624.x.
   Web of Science ®Google Scholar
• Shleifer, A., and R. W. Vishny. 1986. Large shareholders and corporate control. The Journal of Political Economy 94 (3, Part 1):461–88. doi:10.1086/261385.
   Web of Science ®Google Scholar
• Smith, E. D. 1976. The effect of the separation of ownership from control on accounting policy decisions. The Accounting Review 51 (4):707–23. doi:10.2307/246120.
   Web of Science ®Google Scholar
• Sun, B. 2014. Executive compensation and earnings management under moral hazard. Journal of Economic Dynamics and Control 41:276–90. doi:10.1016/j.jedc.2014.02.004.
   Web of Science ®Google Scholar
• Tirole, J. 2006. The Theory of Corporate Finance. New Jersey: Princeton University Press.
   Google Scholar
• Vander Bauwhede, H. 2009. On the relation between corporate governance compliance and operating performance. Accounting and Business Research 39 (5):497–513. doi:10.1080/00014788.2009.9663380.
   Web of Science ®Google Scholar
• Warfield, T. D., J. J. Wild, and K. L. Wild. 1995. Managerial ownership, accounting choices, and informativeness of earnings. Journal of Accounting and Economics 20 (1):61–91. doi:10.1016/0165-4101(94)00393-J.
   Web of Science ®Google Scholar
• Wooldrigde, J. 2002. Econometric analysis of cross section and panel data. London: The MIT Press.
   Google Scholar
• Wu, S.-W., F. Lin, and W. Fang. 2012. Earnings management and investor’s stock return. Emerging Markets Finance & Trade 48:129–40. doi:10.2753/REE1540-496X4805S308.
   Web of Science ®Google Scholar