Earnings Management: Reconciling the Views of Accounting Academics, Practitioners, and Regulators
Patricia M. Dechow
University of California, Berkeley - Haas School of Business
Douglas J. Skinner
The University of Chicago - Booth School of Business
We address the fact that accounting academics often have very different perceptions of earnings management than do practitioners and regulators. Practitioners and regulators often see earnings management as pervasive and problematic, and in the need of immediate action to remedy. Academics are more sanguine, unwilling to believe that earnings management is being actively practiced by most firms or that the earnings management that does exist should necessarily concern investors. We explore the reasons for these different perceptions, and argue that each of these groups may benefit from some rethinking of their views about earnings management.
Number of Pages in PDF File: 26
JEL Classification: M41, M43
Date posted: May 8, 2000
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