文章基本信息

标题：The impact of financial difficulties on earnings management strategies: The case of Italian non-listed firms
其他标题：The impact of financial difficulties on earnings management strategies: The case of Italian non-listed firms
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作者：Gaetano Matonti ; Aurelio Tommasetti ; Carlo Torre 等
期刊名称：African Journal of Business Management
印刷版ISSN：1993-8233
出版年度：2020
卷号：14
期号：11
页码：511-528
DOI：10.5897/AJBM2020.9105
出版社：Academic Journals
摘要：This study investigates the impact of the degree of financial distress on the earnings management activities of Italian non-listed firms using a linear regression model proxied by the Altman Z-Score which controls the heteroscedasticity and autocorrelation using the Petersen method. The extant literature provides mixed evidence on this relationship for listed firms. In this study we find a positive (negative) relationship between financial distress risk and income-decreasing (income-increasing) earnings management, suggesting that firms tend to manage earnings downward as financial distress risk increases. In two robustness tests, we test the power of the Kothari model and we also analyse a reduced firm sample representing over 80% of the population, though the results are qualitatively the same. Our research has several implications for academics, practitioners, lenders, and national standard setters, showing that, in contrast to the extant literature, non-listed firms are more likely to manage earnings downward as their financial situation deteriorates. Furthermore, our findings are of interest to national standard setters and professional accountants who are concerned with advanced warning indicators of firm financial problems such as Altman’s Z-score, especially in recent years in which countries are focused on developing robust empirical models to detect firm financial difficulties.
关键词：Financial distress; Altman’s Z-score; accrual-based earnings management; non-listed firms; Italian context.