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International Journal of Academic Research in Accounting, Finance and Management Sciences

Open Access Journal

ISSN: 2225-8329

Earnings Management around Research and Development Manipulation

Rihab Guidara, Younes Boujelbene

http://dx.doi.org/10.6007/IJARAFMS/v4-i2/765

Open access

The aim of this paper is to investigate the impact of research and development investment (R&D) on managers’ behaviour. Specifically, considering that R&D is a specific investment, inherently exposed to a high level of uncertainty and high information asymmetry and that R&D accounting choices are a controversial issue, the current study tries to evaluate R&D effect on earnings management. The study is conducted on a sample of French companies investing heavily in R&D and accounting data are collected from the Worldscope database. The earning management is estimated through the discretionary accruals. Results indicate that R&D favours both incentive and ability for managers’ earnings management.

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In-Text Citation: (Guidara & Boujelbene, 2014)
To Cite this Article: Guidara, R., & Boujelbene, Y. (2014). Earnings Management around Research and Development Manipulation. International Journal of Academic Research in Accounting Finance and Management Sciences. 4(2), 35 – 51.