Earnings Management Following Duality-Creating Successions: Ethnostatistics, Impression Management and Agency Theory
Academy of Management Journal, Vol. 47, April 2004
Posted: 16 Feb 2005
Impression and earnings management were explored via reasoning and methods grounded in ethnostatistics and agency theory. We hypothesized that earnings management occurs more frequently following duality-creating successions than otherwise because CEO-chairs have greater control of the impressions created by their firms' financial reports and are operating under greater expectations of positive results. Using a sample of 173 duality-creating succession announcements and 112 non-duality-creating succession announcements, we obtained empirical results consistent with these predictions.
Keywords: Earnings management, duality, agency theory
JEL Classification: G30, G34
Suggested Citation: Suggested Citation