Financial Reports Quality and Discretionary Accruals Management: Evidence from the Latin American Market
Objective: This study investigates the relationship between the quality of financial reports, as assessed by auditors, and quarterly earnings management in publicly traded companies in Latin America. Method: The analysis was conducted using the Dunn-Bonferroni test on 457 companies from Argentina, B...
| Autores: | , , |
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| Tipo de documento: | artigo |
| Estado: | Versão publicada |
| Data de publicação: | 2024 |
| País: | Brasil |
| Recursos: | Academia Brasileira de Ciências Contábeis (Abracicon) |
| Repositório: | Revista de Educação e Pesquisa em Contabilidade |
| Idioma: | português inglês |
| OAI Identifier: | oai:ojs.www.repec.org.br:article/3496 |
| Acesso em linha: | https://www.repec.org.br/repec/article/view/3496 |
| Access Level: | Acceso aberto |
| Palavra-chave: | Gerenciamento de Resultados Accruals Discricionários Qualidade de Auditoria |
| Resumo: | Objective: This study investigates the relationship between the quality of financial reports, as assessed by auditors, and quarterly earnings management in publicly traded companies in Latin America. Method: The analysis was conducted using the Dunn-Bonferroni test on 457 companies from Argentina, Brazil, Colombia, and Mexico between 2015 and 2019. Discretionary accruals served as a proxy for earnings management, estimated using Pae’s (2005) model with data from Thomson Reuters®. The indicators proposed by Tang et al. (2016) were used to assess the quality of financial reports. Results: The findings show that discretionary accruals are significantly higher in the fourth quarter compared to other quarters, while the first quarter differs significantly from the second and third. Brazil, Colombia, and Mexico reported lower levels of earnings management and higher financial reporting quality than Argentina. These results suggest that countries with higher-quality financial reporting, as indicated by auditors’ opinions, exhibit lower levels of quarterly earnings management, especially in the fourth quarter. Contributions: This study provides valuable insights for regulators and auditors and emphasizes the variation in earnings management disclosures across interim periods and national contexts. It supports the development of higher-quality earnings disclosures in emerging markets, potentially attracting more analysts and investors. |
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