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Uwuigbe, U., Ranti, U. & Bernard, O. (2015). Assessment of the Effects of Firms Characteristics on Earning Management of Listed Firms in Nigeria. Asian Economic and Financial Review, 5(2), 218-228.

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Article

Corporate Governance, CEOs' Financial Incentives and Earnings Management? A Survey

1Department of Accounting, College of Business and Economics, Qassim University, P.O.Box: 6640, Buraidah, 51452, Saudi Arabia


Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport. 2023, Vol. 11 No. 1, 8-18
DOI: 10.12691/jbe-11-1-2
Copyright © 2023 Science and Education Publishing

Cite this paper:
Amal Ghareeb Alharbi. Corporate Governance, CEOs' Financial Incentives and Earnings Management? A Survey. Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport. 2023; 11(1):8-18. doi: 10.12691/jbe-11-1-2.

Correspondence to: Amal  Ghareeb Alharbi, Department of Accounting, College of Business and Economics, Qassim University, P.O.Box: 6640, Buraidah, 51452, Saudi Arabia. Email: amalghalharbi@gmail.com

Abstract

The study aims to review the impact of corporate governance and CEOs' financial incentives on earnings management. Some corporate departments resort to earnings management practices through measurement and accounting disclosure processes in a way that serves their interests, taking advantage of the flexibility in accounting standards to choose between alternative accounting methods and policies. An in-depth discussion of earning management measures was conducted and we concentrate on the Miller ratio, which focuses on working capital and operating cash flows. The study predicts a positive relationship between the board of directors' independence and earnings management and a positive relationship between leverage and earnings management.

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