Accounting Commons^™

Forensic Detection For Earnings Management In Selected Code Law Nations Of Europe, Jef Lee Garner

Walden Dissertations and Doctoral Studies

This study investigated earnings management in European firms. The private investors became victims of manipulated earnings where few laws offered regulatory oversight. The study forensically examined the attributes of earnings management identified using a discretionary accrual model published in Jones' work and Schippers' work. The firms' managers should fulfil agency theory when they made reporting decisions, and they should act in the investors' best interests to fulfil stewardship theory. The managers failed as they seemed to favor insiders when they reported manipulated earnings to outsiders like small investors even though the managers published financial reports conforming to the International Financial …