scholarly journals A Study on the Relationship between Earnings Management Incentives and Earnings Response Coefficient

2016 ◽  
Vol 36 ◽  
pp. 232-243
Author(s):  
Mohsen Hosseini ◽  
Kamal Nadafi Chalestori ◽  
Saeid Rezahi Hi ◽  
Ehsan Ebrahimi
Keyword(s):  
Earnings Management ◽  
Earnings Response Coefficient ◽  
Management Incentives ◽  
Response Coefficient ◽  
Earnings Response ◽  
The Relationship

PENGARUH EARNINGS MANAGEMENT TERHADAP EARNINGS QUALITY

2010 ◽  
Author(s):  
Pupun Tri Wahyuni ◽  
Resti Yulistia Muslim
Keyword(s):  
Earnings Management ◽  
Sampling Method ◽  
Stock Exchange ◽  
Earnings Quality ◽  
Manufacturing Companies ◽  
Financial Report ◽  
Earnings Response Coefficient ◽  
Discretionary Accrual ◽  
Response Coefficient ◽  
Earnings Response

This research objective is to axamine empirically the influence of earnings management on earnings quality. The study motivated by the controversy of previous study about earnings management and earnings quality. Earnings management was measured by Discretionary Accrual and earnings quality was measured by Earnings Response Coefficient (ERC). The units were 128 (16x8) Quartal financial report in manufacturing companies listed in the Jakarta Stock Exchange, started from the year 2005 up to 2006. The data was collected using purposive sampling method. Statistical method used to test the hypotheses was multiple regressions. The result of the research showed that: the influence of earnings management on earnings quality was negative, sig 0.049. It means that the lower earnings management will be followed by higher earnings quality. This study supported the result of Fetham and Pae (2000), Nelson et al. (2000), Scott (2000), Lobo and Zhou (2001), also Teixeira (2002), Pudjiastuti (2006). 

The influence of some factors about the earnings response coefficient (ERC) from the perspective earnings management (GR)

2018 ◽  
Vol 16 (2) ◽  
Author(s):  
Nathan Vasconcellos de A. R. Machado ◽  
Valéria Gama Fully Bressan ◽  
Wagner Moura Lamounier ◽  
Luís Carlos Barbosa dos Santos
Keyword(s):  
Earnings Management ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response

scholarly journals The Effect of Earnings Management and Earnings Persistence on Earnings Response Coefficient: Evidence from Indonesia

2018 ◽  
Vol 6 (1) ◽  
pp. 59
Author(s):  
Suwarno .
Keyword(s):  
Earnings Management ◽  
Stock Exchange ◽  
Earnings Persistence ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response ◽  
Negative Effect ◽  
Positive Effect

This study aims to examine the effect of earnings management and earnings persistence on earnings response coefficient. The sample of research is consumer sector company period 2013 - 2016 which listed in Indonesia stock exchange. The results showed that earnings management had a negative effect not significant on the income response coefficient. The earnings management will reduce the quality of earnings that will negatively reacted investors. While earnings persistence positive effect on earnings response coefficient.

scholarly journals Analisis Pengaruh Beta, Leverage, Dividend Payout Ratio, dan Earnings Persistence terhadap Earnings Response Coefficient pada Indeks Kompas 100

2014 ◽  
Vol 1 (02) ◽  
pp. 121-135
Author(s):  
Dwi Husiano ◽  
Suratno Suratno
Keyword(s):  
Stock Prices ◽  
Systematic Risk ◽  
Jel Classification ◽  
Earnings Persistence ◽  
Growth Opportunities ◽  
Dividend Payout ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response ◽  
The Relationship

ABSTRACT Earnings response coefficient (ERC) reflects the strength of the relationship between income with stock prices. This study aimed to analyze the determinants of the ERC. The population was 100 companies included in the Kompas 100 Index. Tests carried out by multiple regression test. The results show that the leverage, dividend payout ratio affects the ERC, while systematic risk and growth opportunities not significant effect on the ERC. The results are expected to contribute to the issuer, that the consideration of investors to invest in the stock market especially Kompas 100 Index shown to be affected by the level of risk and ividend payout ratio. ABSTRAK Earnings response coefficient (ERC) mencerminkan kekuatan hubungan antara laba dengan harga saham. Penelitian ini bertujuan untuk menganalisis faktor-faktor penentu ERC. Populasi adalah 100 perusahaan yang masuk dalam Indeks Kompas 100. Pengujian dilakukan dengan uji regresi berganda. Hasil pengujian menunjukkan bahwa leverage, dividend payout ratio berpengaruh terhadap ERC, sementara systematic risk dan growth opportunities berpengaruh tidak signifikan terhadap ERC. Hasil penelitian diharapkan yang dapat memberikan kontribusi kepada emiten, bahwa pertimbangan investor untuk berinvestasi di pasar modal khususnya saham yang Indeks Kompas 100 terbukti dipengaruhi oleh tingkat resiko dan rasio pembayaran deviden. JEL Classification: G14, G30

The impact of earnings management on the value relevance of earnings

2017 ◽  
Vol 32 (1) ◽  
pp. 50-74 ◽  
Author(s):  
Wael Mostafa
Keyword(s):  
Earnings Management ◽  
Value Relevance ◽  
Operating Performance ◽  
Accounting Earnings ◽  
Content Type ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Data Limitations ◽  
Earnings Response ◽  
The Impact

Purpose This paper aims to examine the association between earnings management and the value relevance of earnings (the latter is operationalized by earnings response coefficient). Specifically, this study examines whether opportunistic earnings management has a negative impact on the value relevance of earnings for a sample of firms listed on the Egyptian Stock Exchange. Design/methodology/approach Different from prior work and due to data limitations in the Egyptian market, this paper first examines for the existence of earnings management based on the whole operating performances of the firms by testing whether firms with low/poor operating performance are more likely to choose income-increasing actions (strategies) than firms with high operating performance. After confirming that low operating performance firms manage earnings upward, the authors then assess whether this opportunistic earnings management by these low operating performance firms reduces the value relevance of earnings. This is performed by estimating a model of the relationship between stock returns and accounting earnings with a dummy variable that allows parameter shifts for earnings of low operating performance firms. Findings The results show that discretionary accruals are positive and significantly higher for firms with low operating performance than those for firms with high operating performance. These results indicate that low operating performance firms increase the earnings management practices by probably increasing their reported earnings opportunistically to mask their low performance. Furthermore, the results show that the earnings response coefficient is significantly smaller for earnings of low operating performance firms than that for earnings of high operating performance firms. These results suggest that earnings of firms with low operating performance (that are engaged in opportunistic earnings management strategies) have less value relevance than earnings of firms with high operating performance, i.e. the informativeness of managed earnings is lower than that of non-managed earnings. Practical implications Based on these results, it is plausible that the presence of opportunistic earnings management adversely affects the value relevance of accounting earnings. Originality/value Consistent with previous results from developed countries, this study shows that earnings management is a significant factor that affects value relevance of earnings in Egypt.

scholarly journals Analisis Pengaruh Beta, Leverage, Dividend Payout Ratio, dan Earnings Persistence terhadap Earnings Response Coefficient pada Indeks Kompas 100

2014 ◽  
Vol 1 (02) ◽  
pp. 121-135
Author(s):  
Dwi Husiano ◽  
Suratno Suratno
Keyword(s):  
Stock Prices ◽  
Systematic Risk ◽  
Jel Classification ◽  
Earnings Persistence ◽  
Growth Opportunities ◽  
Dividend Payout ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response ◽  
The Relationship

ABSTRACT Earnings response coefficient (ERC) reflects the strength of the relationship between income with stock prices. This study aimed to analyze the determinants of the ERC. The population was 100 companies included in the Kompas 100 Index. Tests carried out by multiple regression test. The results show that the leverage, dividend payout ratio affects the ERC, while systematic risk and growth opportunities not significant effect on the ERC. The results are expected to contribute to the issuer, that the consideration of investors to invest in the stock market especially Kompas 100 Index shown to be affected by the level of risk and ividend payout ratio. ABSTRAK Earnings response coefficient (ERC) mencerminkan kekuatan hubungan antara laba dengan harga saham. Penelitian ini bertujuan untuk menganalisis faktor-faktor penentu ERC. Populasi adalah 100 perusahaan yang masuk dalam Indeks Kompas 100. Pengujian dilakukan dengan uji regresi berganda. Hasil pengujian menunjukkan bahwa leverage, dividend payout ratio berpengaruh terhadap ERC, sementara systematic risk dan growth opportunities berpengaruh tidak signifikan terhadap ERC. Hasil penelitian diharapkan yang dapat memberikan kontribusi kepada emiten, bahwa pertimbangan investor untuk berinvestasi di pasar modal khususnya saham yang Indeks Kompas 100 terbukti dipengaruhi oleh tingkat resiko dan rasio pembayaran deviden. JEL Classification: G14, G30

scholarly journals PRINCIPLES OF PRUDENTIAL IN IFRS FINANCIAL STATEMENTS AND ITS EFFECT ON EARNINGS RESPONSE COEFFICIENT AND PROFIT MANAGEMENT

2017 ◽  
Vol 16 (2) ◽  
Author(s):  
Arna Suryani ◽  
Eva Herianti
Keyword(s):  
Earnings Management ◽  
Precautionary Principle ◽  
Financial Statements ◽  
Significant Positive Effect ◽  
Earnings Response Coefficients ◽  
Earnings Response Coefficient ◽  
Response Coefficient ◽  
Earnings Response ◽  
Positive Effect

<p>The purpose of this study is to determine the effect of prudential principle of financial statements in IFRS on earnings response coefficients and profit management of manufakturing companies. This study uses analytical methods Partial Least Square (PLS) through analisys software called Smart PLS 2.0 M3. The object of this research is manufacturing companies in Indonesia with a total of 57 analysis unit manufacturing company during the period from 2013 to 2015.</p><p>Based on the results of the study, it is obtained the following findings: the precautionary of financial principle is proven to have a significant positive effect on the earnings response coefficient. The prudential financial principle is proven to have significant harmful impact on earnings.Manajemen is proved to have significant positive effect on banking principles prudential reports. Then, precautionary principle financial statements have greater direct influence on earnings response coefficients.</p><p>This study has implications both theoretically and manajerial. The theoretical implication, the study makes an important contribution in the development of the theory of the precautionary principle financial statements, earnings response coefficients and earnings management. Managerial implications, this research has implications for users of financial statements in taking decision that is not only based on accounting figures, but also need to look at the quality of earnings presented. The precautionary principle financial statements required to reduce opportunistic earnings management so as to improve the quality of earnings and designated by increased earnings response coefficients.<br /> <br /> <strong>Keywords</strong>: Principle of Prudence, Financial Statement, Earnings Response Coefficient, Profit Management</p>

scholarly journals Factors Affecting Earning Response Coefficient at LQ-45 Company in Indonesia Stock Exchange

2020 ◽  
Vol 55 (5) ◽  
Author(s):  
Indrayati ◽  
Basuki Rahmat ◽  
Slamet
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Earnings Management ◽  
Stock Exchange ◽  
Investment Opportunity ◽  
Earnings Response Coefficient ◽  
Good Corporate Governance ◽  
Response Coefficient ◽  
Earnings Response ◽  
Asset Growth

This study examines the influence and relationship of the independent variables of capital structure, earnings management, management performance, earnings, and asset growth. Besides, it focuses on auditor opinion, stock prices, return expectations, the Good Corporate Governance, and the Investment Opportunity Set on the dependent variable, namely, the earnings response coefficient. The samples used were companies on the Indonesia Stock Exchange LQ-45 group and 175 other companies. The research method is event research that explains the influence of capital structure factors, earnings management, asset growth, stock price changes, and other factors, including the Indonesia Stock Exchange index on earnings response coefficient. This study shows that capital structure, dividends, and asset growth significantly affect the Earnings Response Coefficient. In contrast, earnings management, earnings growth, performance, auditor opinion, Good Corporate Governance, and Investment Opportunity Sets do not significantly affect the Earnings Response Coefficient.

The Effect of Voluntary Disclosure and Preemptive Preannouncements on Earnings Response Coefficients (ERC) When Firms Manage Earnings

2003 ◽  
Vol 18 (3) ◽  
pp. 379-409 ◽  
Author(s):  
Joshua Ronen ◽  
Tavy Ronen ◽  
Varda (Lewinstein) Yaari
Keyword(s):  
Earnings Management ◽  
Voluntary Disclosure ◽  
Bad News ◽  
Good News ◽  
Earnings Response Coefficients ◽  
Earnings Response Coefficient ◽  
Earnings Surprise ◽  
Response Coefficient ◽  
Earnings Response ◽  
Disclosure Strategy

We study analytically the effect of preliminary voluntary disclosure and preemptive preannouncement on the slope of the regression of returns on earnings surprise—the earnings response coefficient (ERC). When firms do not manage earnings, additional disclosure has no effect, and the ERC is proportional to price/permanent earnings ratio. If they manage earnings by attempting to inflate them, the response to (100% credible) negative earnings surprise is stronger than the response to (less than 100% credible) positive surprise. To avert litigation, firms that manage earnings adopt a partial voluntary disclosure strategy—either public revelation of good news and withholding bad news, or public revelation of bad news and withholding good news. Voluntary disclosure affects ERC on positive earnings surprise only, depending on what the firm reveals: the good- news revealing ERC (GRC) is higher than the bad-news revealing ERC (BRC), because good news enhances the credibility of the positive earnings surprise, even though the market discounts good news. Furthermore, preemptive pre-announcements improve ERC accuracy by narrowing the scope of earnings management.

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