Earnings Management and Firm Valuation Under Asymmetric Information
Posted: 1 Sep 1999
Date Written: January 1994.
Abstract
This paper seeks to provide an explanation for why corporate officers manage the disclosure of accounting information. We show that earnings management affects firm value when value- maximizing managers and investors are asymmetrically informed. In equilibrium, the strategic management of reported earnings influences investors' assessments of the market values of companies' shares.
JEL Classification: G14, M41
Suggested Citation: Suggested Citation
Chaney, Paul K. and Lewis, Craig M., Earnings Management and Firm Valuation Under Asymmetric Information (January 1994.). Available at SSRN: https://ssrn.com/abstract=5312
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