The joint decision to manage earnings through discretionary accruals and asset sales around insider trading: Taiwan evidence

被引：0

作者：

Huang C.-J. ^{[1
]}

机构：

[1] Department of Finance, Providence University, Shalu, Taichung County

来源：

Journal of Economics and Finance | 2010年 / 34卷 / 3期

关键词：

Asset Sales; Discretionary Accruals; Earnings Management; Insider Trading;

D O I：

10.1007/s12197-008-9034-6

中图分类号：

学科分类号：

摘要：

This study assesses the joint decision of multiple earnings-management tools around insider trading. The Taiwanese evidence indicates significantly higher magnitudes of both discretionary accruals and asset sales before insider selling. In addition, to investigate the endogenous relationship between discretionary accruals and asset sales, this study develops a set of simultaneous equations and includes the inverse Mill's ratio as a regressor to account for firms that choose not to use asset sales. The results indicate a marginal complementary correlation between discretionary accruals and asset sales before insider selling. Further tests find this complementary correlation becomes stronger when accompanying abnormal insider selling. The findings support the view that insiders consider both tools jointly and adjust them as complements to meet their directional earnings management objective. © 2008 Springer Science+Business Media, LLC.

引用

页码：308 / 325

页数：17

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